**U.S.
      SECURITIES AND EXCHANGE COMMISSION**


**WASHINGTON,
      D.C. 20549**




**FORM
      10-K**




**ANNUAL
      REPORT UNDER SECTION 13 or 15 (d) OF**




**THE
      SECURITIES EXCHANGE ACT OF 1934**




For
      the
      fiscal year ended December 31, 2007




*Commission
      file number 00-30585*




**CREATIVE
      VISTAS, INC.**




**(Exact
      name of registrant as specified in its charter)**




Arizona
              (State
                or other jurisdiction of
              incorporation
                or organization
            3669
              (Primary
                Standard Industrial
              Classification
                Code Number)
            86-0464104
              (I.R.S.
                Employer
              Identification
                No.)




2100
                Forbes Street
              Unit
                8-10
              Whitby,
                Ontario, Canada L1N 9T3
              (905)
                666-8676(Address
                of principal executive offices)




Registrant’s
                telephone number, including area code:(905)
                666-8676Securities
                registered pursuant to Section 12 (b) of the Exchange Act:NoneSecurities
                registered pursuant to Section 12 (g) of the Exchange Act:




Title
                of Class
            
            Number
                of Shares Outstanding as ofMarch
                31, 2008Common
                Stock, $.01 par value
            
            34,496,623




Indicate
      by check mark if the registrant is a well-known seasoned issuer, as defined
      in
      Rule 405 of the Securities Act.


Yes
oNo
x





Indicate
      by check mark if the registrant is not required to file reports pursuant to
      Section 13 or 15(d) of the Act.


Yes
oNo
x





Indicate
      by check mark whether the registrant: (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
      the
      preceding 12 months (or for such shorter period that the registrant was required
      to file such reports), and (2) has been subject to such filing requirements
      for
      the past 90 days. Yes xNo o




Indicate
      by check mark if disclosure of delinquent filers pursuant to Item 405 of
      Regulation S-K is not contained herein, and will not be contained, to the best
      of the registrant's knowledge, in definitive proxy or information statements
      incorporated by reference in Part III of this Form 10-K or any amendment to
      this
      Form 10-K. x




Indicate
      by check mark whether the registrant is large accelerated filer, an accelerated
      filer or a smaller reporting company (as defined in Exchange Act Rule 12B-2)




Large
      accelerated filer oAccelerated
      filer oNon-accelerated filer o(Do
      not check if a smaller reporting
      company) Smaller reporting company x





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act).


Yes
oNo
x




Issuer’s
      revenues for its most recent fiscal year: $39,991,068




The
      aggregate market value of the voting and non-voting common equity held by
      non-affiliates of the Registrant, based on the closing price for such common
      equity on March
      31,
      2008 is
      approximately $65,198,617.The number of shares outstanding of the Issuer’s
      common stock, as of March
      31,
      2008 :
      34,496,623 shares.







Item
                      1.
                  Business
                  1Item
                      2.
                  Description
                      of Properties
                  18Item
                      3.
                  Legal
                      Proceedings
                  18Item
                      4.
                  Submission
                      of Matters to Vote of Security Holders
                  18Item
                      5.
                  Market
                      for the Registrant’s Commission Equity Related Stockholder Matters and
                      Issuer Purchases of Equity Securities
                  18Item
                      6.
                  Selected
                      Financial Data
                  19Item
                      7.
                  Management’s
                      Discussion and Analysis or Plan of Operation
                  19Item
                      8.
                  Financial
                      Statements
                  F-1
                      - F-30Item
                      9.
                  Changes
                      in and disagreements with accountants on accounting and financial
                      disclosure
                  28Item
                      9a.
                  Controls
                      and Procedures
                  28Item
                      9b.
                  Other
                      Information
                  29Item
                      10.
                  Directors,
                      Executive Officers, Promoters and Control Persons of the
                      Registrant
                  29Item
                      11.
                  Executive
                      Compensation
                  30Item
                      12.
                  Security
                      Ownership of Certain Beneficial Owners and Management and Related
                      Stockholder Matters
                  31Item
                      13.
                  Certain
                      Relationships and Related Transactions
                  34Item
                      14.
                  Principle
                      Accountant Fees and Services
                  35Item
                      15.
                  Exhibits
                  35








**Forward-Looking
      Statements**




*Certain
      statements within this Form 10-K constitute “forward-looking statements” within
      the meaning of the Private Securities Litigation Reform Act of 1995. Such
      forward-looking statements involve known and unknown risks, uncertainties and
      other factors that may cause the actual results, performance or achievements
      of
      Creative Vistas, Inc. to be materially different from any future results,
      performance or achievements expressed or implied by such forward-looking
      statements. These forward-looking statements are based on our current
      expectations and are subject to a number of risks, uncertainties and assumptions
      relating to our operations, financial condition and results of operations,
      including, among others, rapid technological and other changes in the market
      we
      serve, our numerous competitors and the few barriers to entry for potential
      competitors, the seasonality and quarterly variations we experience in our
      revenue, our uncertain revenue growth, our ability to attract and retain
      qualified personnel, our ability to expand our infrastructure and manage our
      growth, and our ability to identify, finance and integrate acquisitions, among
      others. If any of these risks or uncertainties materializes, or if any of the
      underlying assumptions prove incorrect, actual results may differ significantly
      from results expressed or implied in any forward-looking statements made by
      us.
      These and other risks are detailed in this Annual Report on Form 10-K and in
      other documents filed by us with the Securities and Exchange Commission.
      Creative Vistas, Inc. undertakes no obligation to update publicly any
      forward-looking statements for any reason, even if new information becomes
      available or other events occur in the future.*




**Item
                  1.**
                **Description
                    of Business**




**Corporate
      Background and Overview**




Creative
      Vistas, Inc. was incorporated in the state of Arizona on July 18, 1983. We
      are a
      leading provider of security-related technologies and systems. We also provide
      the deployment of broadband services to the commercial and residential market.
      We primarily operate through our subsidiaries AC Technical Systems Ltd. (“AC
      Technical Systems”) and Iview Digital Video Solutions Inc. (“Iview DVSI”), to
      provide integrated electronic security-related technologies and systems. AC
      Technical Systems is responsible for all of our revenues in the security sector
      for 2007. It provides its systems to various high profile clients including:
      government, school boards, retail outlets, banks, and hospitals. Iview DVSI
      is
      responsible for providing video surveillance products and technologies to the
      market.




On
      December 31, 2005, we acquired Cancable Inc. (“Cancable”) through our wholly
      owned Delaware subsidiary, Cancable Holding Corp. Cancable is in the business
      of
      providing the deployment and servicing of broadband technologies in both
      residential and commercial markets. Cancable has offices in Ontario, Canada.
      All
      related documents were disclosed in Form 8-K/A filed on January 6, 2006. In
      October 2007, we entered into an agreement, through our wholly owned newly
      formed Ontario subsidiary, Cancable XL Inc. (“Cancable XL”), to acquire all of
      the issued and outstanding shares of capital stock and any other equity
      interests of XL Digital Services Inc. (“XL Digital”), an Ontario corporation.
      All related documents were disclosed in Form 8K filed on October 17, 2007.
      During the year, we have incorporated 2141306 Ontario Inc. (“OSS-IM”) as a
      subsidiary of Cancable. OSS-IM
      specializes in research and development of proprietary BI software. The current
      version of BI software is a leading-edge program that can manage data from
      over
      a million multi-faceted transactions fulfilled annually by Cancable for its
      large cable-system customers. Wireless and web enabled, the software provides
      automated intelligent decision-making for managing customer transactions,
      vehicles, technicians, supply chains, HR-related functions and other
      activities.




Today,
      our operations are divided into two distinct operating segments: (a) security
      and surveillance products and services, and (b) broadband deployment and
      provisioning services. Through AC Technical Systems we provide integrated
      security solutions to our commercial customer base. Through Cancable, XL Digital
      and OSS-IM, we provide broadband deployment and provisioning services to
      residential, as well as web based support and small businesses
      markets.









The
      current corporate structure is as follows:








2




**Security
      and Surveillance Products and Services**




AC
      Technical Systems is focused on the electronic security segment of the security
      industry. Through our technology integration team of engineers, we integrate
      various security related products to provide single source solutions to our
      growing customer base. Our design, engineering and integration facilities are
      located in Ontario, Canada. We operate through our Iview DVSI subsidiary to
      build out Digital Video Management Systems (DVMS) to provide PC based video
      management systems to the surveillance market. Iview is a product company and
      sells to distributors and integrators in North America. Iview is in early stages
      of building a strong consistent sales and marketing team to start contributing
      revenues to us.




**Ind** **u** **stry
      Overview**




We
      believe that the security industry is growing at a steady pace. There has been
      renewed focus on our industry since the events of September 11, 2001. The growth
      is spurred by the continuous evolution of new technologies and processes. We
      believe that the industry is growing for the following reasons:




·
            Increased
                global awareness due to the increased threats of terrorism;




·
            Older
                security devices such as the VCR have become obsolete and new technologies
                have provided much more efficient systems at a better price;




·
            Evolving
                digital technologies have started to replace antiquated analog
                technologies in the market space;




·
            Expansion
                of budgets due to increased awareness of the need for
                security;




·
            Increase
                in crime rates and shrinkage in
                industry;




·
            Integration
                of multiple devices has expanded the market for technically advanced
                integrators such as our firm; and




·
            Growing
                public concern about crime.




·
            Decreased
                cost of security technology.




The
      security industry is highly fragmented with a large number of manufacturers,
      dealers, distributors, integrators and service groups. All of these parties
      provide part of the entire solution to the customer. Customers prefer a one-stop
      shop that provides them with the entire solution and also designs and customizes
      a solution that fits their needs. This solution may include custom design of
      hardware, software, along with highly sophisticated integration work. In most
      cases the cost to the customer is higher when using a large number of parties
      as
      opposed to one efficient integrator. We believe that when many parties are
      involved in providing a solution to the customer, many needs of the customer
      may
      not be addressed. The amount of time a customer has to devote to build multiple
      relationships as opposed one relationship is substantial. There are also
      tendencies for different parties to “pass the blame” to the other party when it
      comes to technical and service issues with the project. As a result, the
      customer prefers dealing with one source that can handle all issues and be
      accountable for an entire project. There are a limited number of companies
      besides us that are capable of providing this entire integrated solution.
      Providing such a solution requires years of experience, infrastructure for
      performing all six core functions that we provide, access to technologies and
      a
      significant commitment to maintaining a satisfied customer.




A
      company
      that is implementing a new security system or enhancing an old system usually
      has to go through the following steps:




·
            Retain
                a consultant to appropriately outline its needs and design a system
                that
                satisfies those needs;




·
            Once
                the design is complete, a tender is released whereby a number of
                invited
                system integrators bid on the required system;




·
            System
                integrators work with various suppliers of hardware and software
                to meet
                the system requirements. They also engage these suppliers to complete
                subcomponents of the system;




·
            When
                security systems have to be installed in multiple locations, the
                company
                may have to tender the system requirements to different system integrators
                from various regions; and




·
            The
                customer, based on price and qualifications of the system integrator,
                will
                award the project to one or more system
                integrators.




3




The
      process described above can cause a number of issues for clients including
      client frustrations with project delays, cost inefficiencies, incompatible
      systems and lack of vendor accountability. It also makes it very difficult
      for
      the customer to make changes to the system. In addition, a customer looking
      to
      implement security systems in multiple locations may have to hire multiple
      integrators and suppliers to integrate systems. This usually results in systems
      that are not consistent with each other. These systems may also not communicate
      efficiently with a central system. In addition, as security systems become
      more
      technologically advanced, an experienced engineering team is required to
      understand the needs of the customer and satisfy those needs by incorporating
      the most efficient technologies available into the security system. This may
      also include some development of hardware and software to customize and
      integrate the system. Most system integrators are not capable of development,
      as
      they do not have a research and development department. Also, the manufacturers
      of different subsystems are usually not willing to provide custom solutions
      on a
      project basis. Customers are realizing the sophistication required in order
      to
      provide a good security system and recognizing that their in-house personnel
      lack the skills and time necessary to coordinate their security
      projects.




**Our
      Strategy**




We
      have
      identified four key markets to target with our solution described below. These
      are 1) government, 2) education, 3) healthcare, and 4) retail. We offer a
      one-stop-shop that provides a fully integrated technology based security system
      to meet the needs of the customer. We understand the needs of the customer
      and
      provide a custom solution to meet their needs. We expedite project completion,
      reduce costs to the customer, reduce manpower requirements of the customer
      and
      improve systems consistency in multiple locations.




We
      provide the following services:




·
            Consulting,
                audit, review and planning;




·
            Engineering
                and design;




·
            Customization,
                software development and interfacing;




·
            System
                integration, installation and project
                management;




·
            System
                training, technical support and maintenance;
                and




·
            Ongoing
                maintenance, preventative maintenance and service and
                upgrades.




We
      believe that the following key attributes provide us with a sustainable
      competitive advantage including:




·
            Experience
                and expertise in the security industry;




·
            In-house
                research and development departments;




·
            Dedicated
                service team;




·
            Access
                to and experience in a variety of product mix;




·
            Customized
                software and hardware products;




·
            Strong
                references; and




·
            Strong
                partnerships with suppliers and
                integrators.




Our
      strategy for growth and expansion is to:




·
            Expand
                our network of technology partners;




·
            Develop
                and maintain long-term relationships with clients;




·
            Open
                regional offices in key areas to expand revenue and
                service;




·
            Capitalize
                on our position as a leading provider of technologically advanced
                security
                systems; and




·
            Expand
                our marketing and sales program within our key vertical
                markets.




At
      the
      beginning of each new client relationship, we designate an account manager
      as
      the client service contact. This individual is the point person for
      communications between the client and us. The account manager usually has a
      number of years of experience in the industry and a good understanding of
      technologies and solutions that we provide. This person is also a trained
      salesperson who is able to build a long-term relationship with the customer.
      The
      account manager works with our project department, engineering department,
      marketing department, finance department and research and development department
      to provide an effective solution for the customer. Once the customer has engaged
      us to provide a solution, the engagement usually goes through one or more of
      the
      stages outlined below:




*Consulting,
        audit, review and planning*
  We
        identify the client’s objectives and security system requirements. We then audit
        and review the client’s existing system. This audit of the existing system
        evaluates inventory counts and the existing infrastructure. Then we provide
        an
        audit report to outline current deficiencies and vulnerabilities. At this
        point
        we design a system alternative to meet the needs of the customer. The
        alternative system is prioritized based on the needs of the customer. We
        also
        include an efficient cost model to ensure that the customer understands the
        cost
        of the system. We provide a Return On Investment (ROI) model where applicable.
        We also provide a preliminary project implementation plan that contains a
        graphical model of the client’s premises with exact outlines of equipment
        locations. Our comprehensive planning process helps the customer to properly
        budget for its needs on a long-term basis.




4




*Engineering
      and design*




The
      engineering and design process involve preparation of detailed project
      specifications and working drawings by a team of our design engineers. These
      drawings lay out the entire property and provide a detailed map of all security
      equipment and the methodologies used to integrate the system. The specification
      and drawings also outline any needs for custom software or hardware design
      services, systems designers and computer-aided design system operators. These
      specifications and drawings detail areas of high sensitivity, the layout of
      the
      main control room, and the placement of cameras, card readers, monitors,
      switches and other equipment.




Once
      our
      system design has been completed, we provide a complete list of components
      and
      recommendations. We highly recommend off-the-shelf non-proprietary components
      in
      order to ensure that the customer is not tied into one supplier. When
      off-the-shelf components are not available or are not compatible with each
      other, we design software or hardware to provide compatibility.




*Customization,
      software development, interface*




In
      many
      cases, the customer’s needs may not be completely satisfied by the equipment
      available in the market place. The customer may request features or equipment
      that are not readily available. For example, a financial institution may request
      us to take information from their transaction records and an Automatic Teller
      Machine (ATM), and then integrate that information with a Digital Video Recorder
      (DVR). This would allow them to review video of an individual who has processed
      a transaction on an ATM. Normally a financial institution requiring this
      information would have to go through tapes of data in order to find it. Such
      a
      bank would have to search all the transactions that occurred during a period
      of
      time and then, based on that information, go over tapes of video. Sometimes
      the
      video may not be available if the tapes are only held for a short period of
      time. Our firm’s integrated system makes this search process instantaneous. Our
      system allows a bank to search by a number of criteria including time, date,
      transaction, number and withdrawal amount. A bank can also have video associated
      with such a search instantly.




Many
      times we provide an interface to bring multiple technologies together. In one
      project we integrated eleven different products into one system, thus allowing
      for a completely integrated system. This integrated system also has a very
      user-friendly interface that avoids having to deal with multiple monitors and
      Graphical User Interfaces (GUI).




*System
      integration, installation, project management:*




Once
      we
      determine that a project has passed through the consulting/audit,
      design/engineering and customization/software interfacing stage (if required)
      we
      can start the implementation of system. During this stage, we provide the
      following:




·
            Detailed
                schedule of integration




·
            List
                of components and labor assignments




·
            Officially
                assign the project to one of our project managers




·
            Production
                department starts procurement schedules




·
            Construction
                draw date schedules




·
            Progress
                billings and schedule site visits for quality control




·
            Tests
                of final terminations and technology components in-house in order
                to avoid
                product failure on site




·
            Hardware/software
                and network integration




·
            Validation
                and testing




·
            Final
                sign off and pass over to service
                department




5




During
      this stage the project manager manages the project and the projects are updated
      weekly to ensure that all components are working efficiently. During certain
      projects the project manager may opt to use subcontractors to provide services
      that are not highly advanced technically. These services may include standard
      wiring and cabling. The customer is updated on the status of the project weekly.
      These updates may include Gantt charts. During this stage, many customers see
      the need for additional enhanced equipment, which increases the value of the
      contract to us.




*System
      training, technical support, maintenance*




When
      a
      project has been completed through system integration, the customer is provided
      with a complete training program. We train the customer on how to use the system
      and also provide them with manuals from manufacturers as well as training guides
      put together by us. Once the training is complete the system will go on line
      and
      there is a transfer process to the service department from the projects
      department. Ongoing technical support and maintenance are provided by our
      dedicated service team.




*Ongoing
      maintenance, preventative maintenance and service, upgrades:*




This
      is
      the final stage of our process and it is an ongoing stage. We provide various
      types of maintenance contracts, which vary depending on the level of response
      required by the customer. We also provide a service plan suitable to the
      customer. If the customer does not require a service contract, we provide them
      with service on an incident by incident basis.




The
      entire six steps process continues for each customer. Once a project is
      complete, there are upgrades that are required. Depending on the value of the
      upgrades, they may initiate a new project. During every stage an account manager
      is updated on the process. Account managers have regular meetings with the
      customers after projects are complete in order to help set budgets for the
      following years and also educate customers on new products and technologies
      that
      may be available in the market.




**Research
      and Development**




We
      have
      our own in-house research and development programs which are supported by the
      National Research Council of Canada. We may receive grants and tax credits
      for
      customers on projects and product development if they qualify for the program.
      Our product development department develops new products and also enhances
      existing products. We have the capability to build various forms of hardware
      and
      software modules. Once a product is designed, the underlying technologies are
      used on an ongoing basis to enhance future projects and develop new products.
      This is one of the differentiating factors between our competitors and us.
      Our
      research and development expenses were approximately $289,800 in fiscal year
      2007 and $400,600 in fiscal year 2006. Expenses include engineering salaries,
      costs of development tools and equipment. None of the expenses were borne
      directly by customers.




**Warranties
      and Maintenance**




We
      offer
      maintenance and service on all our products, including parts and labor, which
      range from one year to six years depending upon the type of product concerned
      and the type of contract signed by the customers. In addition, we provide a
      one-year warranty on equipment and a 90 day warranty all installation projects
      completed by us. We receive the same warranty on equipment from our other
      external suppliers.




On
      non-warranty items, we perform repair services for our products sold at our
      main
      office in Ontario, Canada or at customer locations. For the years ended December
      31, 2007 and December 31, 2006, our revenue from service and maintenance were
      $1,544,435 and $1,284,000 respectively.




**Marketing**




Our
      marketing activities are conducted on both national and regional levels. We
      obtain engagements through direct negotiation with clients, competitive bid
      processes, referrals and direct sales calls. Our marketing plan is derived
      with
      input from all our account managers and senior management. Our plan is to grow
      vertically within targeted markets where we have a superior level of expertise.
      Our marketing is very target specific. We market within our four key markets.
      We
      also find niche markets where our technologies can provide effective solutions
      to the customer. Some of our marketing activities include:




·
            Trade
                Shows




·
            Mailers




·
            Direct
                sales calls




6




·
            Web
                promotions




·
            Seminars




·
            Collaborations
                with manufacturers




·
            Collaborations
                with consultants and architects




We
      also
      collaborate with providers of complementary technologies and products who are
      not competitive with us. For example, there is a convergence of IT services
      and
      the security industry. We are evaluating the possibility of partnering with
      an
      IT services provider in order to provide our existing and potential customers
      with an expanded scope of services. We are also doing the same within the
      building automation industry as we see a convergence of building automation
      technologies and services with the security industry.




We
      are
      evaluating several opportunities to expand our operations via joint ventures
      and
      partnerships with regional and international companies that can provide us
      with
      additional expertise and an expanded presence. In addition we are evaluating
      the
      possibility of acquiring similar businesses and expanding our
      operations.




**Customers**




We
      provide our products and services to customers in five markets :




·
            Government




·
            Healthcare




·
            Education




·
            Retail




·
            Commercial
                Property Management




We
      also
      provide our products and services to various other sectors including corporate
      facilities, mining, entertainment and the automobile industry through direct
      sales to end-users and through subcontracting agreements.




**Backlog**




Our
      backlog consists of written purchase orders and contract, we have received
      for
      product deliveries and engineering services that we expect to deliver or
      complete within 12 months. All of these orders and contracts are subject to
      cancellation at any time. As of December 31, 2007, our backlog was
      approximately $2,500,000 on contract revenue.




**Competition**




The
      security industry is highly fragmented and competitive. We compete with a number
      of different companies regionally and nationally. We have various different
      types of competitors including consultants, integrators, and engineering and
      design firms. Our main competitors include Siemens, ADT, Simplex, Intercon
      and
      Diebold. Our competitors also include equipment manufacturers and vendors that
      provide security services. Some of our competitors have greater name recognition
      and financial resources than we do. However, we believe that we have a
      well-respected name and are known for our quality work and technical expertise.
      We may face future competition from potential new entrants into the security
      industry and increased competition from existing competitors that may attempt
      to
      develop the ability to offer the full range of services offered by us. We cannot
      assure that we will be able to compete successfully in the future against
      existing or potential competitors.




**Employees**




As
      of
      December 31, 2007, Cancable
      has a staff of over 400
      employees and A.C. Technical Systems has a staff of 49 full time employees
      including our officers, of whom 32 were engaged in systems installation and
      repair services, 11 in administration and financial control and 6 in marketing
      and sales.




None
      of
      our employees are covered by a collective bargaining agreement or represented
      by
      a labor union. We consider our relationship with our employees to be
      satisfactory.




7




The
      design and implementation of our equipment and the installation of our systems
      require substantial technical capabilities in many different disciplines from
      computer science to electronics with advanced hardware and software development.
      As a company, we encourage and provide training for new and existing technical
      personnel. In addition we conduct training courses and also send our technical
      persons to various technical courses offered by manufacturers of various
      products. We have various incentive programs for our employees to improve their
      skills within all departments. These include reimbursements for training fees
      and raises based on skill sets.




**Broadband
      deployment and provisioning services**




We
      operate through our subsidiaries Cancable Inc. and XL Digital Services Inc.
      (together the “Cancable Group”), located in Ontario, Canada to provide and
      deploy broadband services. Cancable Inc. and XL Digital Services Inc. were
      subsequent acquisitions.





Cancable
      Inc. is
      a
      growing Canadian based leader in providing and servicing broadband technologies
      to both residential and commercial markets. The Cancable service offering,
      network deployment, IT integration, and support services enable the cable
      television and telecommunications industries to deliver a high quality broadband
      experience to their customers. Cancable’s clients rely on Cancable’s knowledge
      and expertise to rapidly deploy the latest technologies to support advanced
      cable services, cable broadband Internet access and DSL. Services provisioned
      include new installations, reconnections, disconnections, service upgrades
      and
      downgrades, inbound
      technical call center sales and trouble resolution for cable Internet
      subscribers ,
      and
      network servicing for broadband video, data, and voice services for residential,
      business, and commercial marketplaces.




Cancable
      has a long history as a field services organization. It has been successful
      in
      developing long-term relationships with its clients and is highly regarded in
      the
      industry for quality. This is evidenced by its status as the largest service
      provider to Rogers Cable Inc., Canada’s largest cable company and the exclusive
      supplier to Cogeco Cable Inc. in the Windsor, Ontario area. Cancable’s central
      appeal to its customers is its ability to deliver its quality services and
      at a
      cost which they cannot match internally.




XL
      Digital Services Inc. (“XL Digital”), incorporated in 2007, is a Canadian-based
      company provisioning the deployment and servicing of broadband technologies
      in
      the residential market for Canada’s largest cable television provider, Rogers
      Cable. XL
      Digital, with over 70 employees, provides its deployment and provisioning
      services for Rogers within two territories where the Company currently did
      not
      have a presence. The acquisition enables the Company to further expand its
      services into these two growing territories. XL Digital also brings the Company
      a number of years of significant management experience within the cable and
      telecommunications sector.




**Senior
      Management**




Cancable
      Group has a proven team with over 70 years of cable TV contracting/technical
      deployment and support experience.




**Ross
      Jepson, President and CEO,** has
      successfully completed a number of senior executive assignments in the cable
      and
      telecommunications sector since 1985. He was appointed President and CEO in
      January 2003 after serving one year as the EVP, Operations. In addition to
      having led the purchase and sale of numerous companies during his executive
      career, he is also deeply experienced in sales, marketing, operations and new
      business development.




**Mark
      Thompson, MBA (Finance & Human Resources)**  **VP,
      Fin & Admin,** joined
      Cancable in November 2004, bringing over 10 years of Finance and Consulting
      experience in entrepreneurial, high growth and turnaround situations. He has
      held senior roles in the high-tech, distribution and financial services
      industries. Mr. Thompson is responsible for all finance, accounting, is-it,
      and
      human resources functions for Cancable.




**Robert
      R. Newell, Senior Vice President,, US Operations,** joined
      Cancable in October 2007. He was chief operating officer and chief business
      development officer of 180 Connect Inc., a national cable and satellite
      fulfillment service, based in Denver, CO., that he co-founded in 2000 and helped
      build into a company with $300 million in annual revenues. Customers of 180
      Connect included Comcast, Cox, Time Warner, Cablevision, Hughes Network Services
      and DirecTV. He has particular expertise in start-up, turnaround and integration
      of acquired companies and his addition to the Cancable team significantly
      improves our capability to execute on our U.S. expansion strategy.




8




**Paul
      Saabas, MBA, President, Dependable Home Support Services** ,
      has
      sales and operational management experience with a wide range of companies,
      including cable services (Rogers Cable) and security products and services
      (Honeywell Ltd.). Most recently, he was a principal of PMJ Consulting, a company
      that provided business planning and other strategic services to start-up
      companies. Among his clients was Bell New Ventures, the group created in 2006
      by
      Bell Canada, Canada's largest communications provider, to initiate new products
      and services based on Bell Canada's wireless, Internet, voice and web-based
      capabilities.




**Paul
      Markovsky, MBA, General Manager, Canadian Field Operations,** joined
      Cancable in October 2006 as District Manager, GTA East and was promoted to
      his
      current position in March 2008. His previous position was Manager of Operations
      at QX Locates, a division of Aecon Group Inc., where he was chosen to head
      the
      growth of an expanding business whose customers included Bell Canada, Enbridge
      Gas and Union Gas. Mr. Markovsky is responsible for the management of all
      Canadian operations and field service management in the utilities and cable
      sectors.




**Cheryl
      Lewis, Director, DependableIT** ***,*** began
      her career at Cancable in 1998 managing the dispatch group and building the
      original team of technicians. Ms. Lewis later assumed responsibility for the
      DependableIT division, a call center managing all incoming tech support calls
      and sales leads, as well as on-site technicians resolving computer support
      issues.




**Steve
      Skrlac, CFA, MBA, BA, Vice President Sales and Business
      Development** .
      Mr.
      Skrlac joined the Cancable group in February 2008 and brings with him both
      a
      marketing and finance background in the telecommunications, home service,
      and business fields. He has worked for Mountain Cablevision for the past 4
      years in a senior leadership position and was with Bell Canada for the 4 years
      prior to this. Mr. Skrlac is responsible for the sales planning and field
      execution.




**Our
      Strategy**




Cancable
      b elieves
      that there is a large and growing market for its services and the demand for
      its
      services is growing as:




·
            The
                increase in popularity of the Internet and in the complexity of Internet
                sites has increased demand for high-speed Internet access from both
                residential and commercial consumers;




·
            Technological
                advances, including the shift from an analog to a digital network
                environment and the ability to leverage existing network infrastructure
                to
                deploy high-speed services such as IP networking technologies, have
                accelerated the availability of advanced services such as digital
                video
                and high-speed Internet access;




·
            Cable
                and telecommunications service providers have made significant investments
                to build and upgrade their wired and wireless networks, creating
                a
                substantial opportunity to deliver advanced services to commercial
                and
                residential consumers;




·
            End-users
                increasingly demand access to integrated video, voice and data services,
                advanced set top boxes, high-speed digital modems, telephone lines,
                voice
                mail, computer networks, video conferencing and other technologies.
                Cancable’s clients must rapidly deploy these technologies in order to
                maximize their revenue per end-user, realize a return on their investments
                and maintain or gain competitive advantages; and




·
            The
                availability of multiple choices for end-users to receive advanced
                services has led broadband service providers to focus increasingly
                on
                end-user satisfaction to control turnover and to rely on technology
                enabling companies for some of their non-core activities, such as
                installation, integration, fulfillment, maintenance, warranty and
                support
                services.




9




**Key
      Client Relationships**




Cancable
      has two main customer relationships, Rogers Cable Inc. and Cogeco Cable. Rogers
      Cable Inc. is the most significant.




**Rogers
      Cable Inc.**




Rogers
      Cable Inc. is
      Cancable Group’s largest customer employing greater 250 of our field technicians
      (Mississauga Primary contractor with 85, Scarborough Primary with 60, Toronto
      Secondary with 40) as of December
      31, 2007 .
      In
      addition to its in-house capability, Rogers currently utilizes eight contractors
      to manage its cable TV activity. This number is down from 22 contractors three
      years ago. Over the past two years, as a result of the vendor consolidation
      and
      its top rated performance, Cancable Group has emerged as Rogers’ primary
      contractor in the Greater Toronto Area greater than 40% share of completed
      work
      orders




In
      addition to installation and service work, Cancable has finalized a new three
      year agreement that extends the types of services it will be performing. As
      evidence of Rogers growing dependency on Cancable, Rogers has requested that Cancable
      supplement its Tier 2 and Tier 3 customer service programs, something that
      is
      presently handled only by Rogers personnel. In this service, a call is
      transferred from Rogers’ customer service department to DependableIT, Cancable’s
      branded technical support centre, after Rogers determines that it is not
      directly a Rogers cable related problem. DependableIT’s remote diagnostic tools
      provide it with a complete situational review of the customer’s site. In these
      instances, the charge is billed to the customer’s credit card before assistance
      is provided. With the Tier 3 service, a field service visit is required and
      a
      Cancable technician is dispatched to the customer’s location with rates charged
      on an hourly basis for residential and commercial customers. Again, this service
      is presently provided by Rogers personnel only.




**Cogeco
      Cable Inc.**




Cancable’s
      current field supporting work with Cogeco is limited to the Windsor, Ontario
      area. In November 2003, Cancable assumed exclusive responsibility for all
      Cogeco-related installation activity. Cancable is currently in discussions
      on a
      new two year contract. Under this contract, Cancable’s 20 technicians will be
      co-located in Cogeco’s facility and the current residential install business
      will be expanded to include commercial work including all Cogeco commercial
      Internet sales and technical calls. DependableIT will charge a per call fee
      for
      support, and most significantly, earn commission on services sold. In addition
      the service offering is expanding into Tier 2 service - residential, similar
      to
      that currently being provided to Rogers.




Cancable’s
      competition within its geographical segment is contained to a minimal number
      of
      firms. They include Wirecomm, Trinity Cable and J&P Cable among others. We
      believe that our contracted revenue is significantly higher than any of the
      other competitors in our geography and thus gain an advantage due to our size
      and internally efficient systems.




**The
      Contract Field Technical Support Industry**




**Overview**




In
      2004,
      the cable television industry in Canada served 9.3 million homes of which 2.3
      million were subscribers to digital cable. While direct to home satellite
      service providers have penetrated the video market, cable operators continue
      to
      maintain an overall 77% market share.




A
      significant development for both cable and telecom companies has been the
      acceptance of the internet as a mass medium for commerce and communications
      involving both residential and commercial consumers. A recent reported stated
      that, as of 2004, 44% of Canadian homes were connected to high-speed Internet
      services. Approximately 2.3 million homes connect via cable while 1.9 million
      connect via telco providers.




At
      present, Cancable’s management believes that there are approximately 25
      providers of contract field technical support serving the Ontario cable
      television market. Management also believes that this number will be markedly
      reduced in the near future as evidenced by the vendor consolidation initiative
      recently completed by Rogers. Management believes that its cable television
      clients who operate in multiple geographic markets will prefer to align
      themselves with larger technology enablers, like Cancable, who are able to
      deploy consistent service on a wider scale and have the expertise and resources
      to deploy and maintain increasingly complex technologies.




10




Accordingly,
      management believes that its target market presents substantial growth
      opportunities due to:




·
            the
                increasingly competitive landscape in the areas of video, internet
                and
                telecom delivery, which are requiring cable operators to increase
                their
                commitment to quality customer service and strict quality
                standards;




·
            a
                drive for cost reductions on the part of the cable operators, caused
                by
                price competition due to “bundling” strategies by them and their
                competitors;




·
            the
                increasing demand by residential and commercial consumers for advanced
                broadband services such as high-speed internet access, digital video
                and
                telephone;




·
            the
                need to satisfy the demand for emerging broadband communications
                technologies such as web-based video
                conferencing;




·
            virtual
                private networks, which are networks run over the internet that provide
                privacy to the network users;




·
            Voice-Over-IP
                (VOIP), which will allow simultaneous two-way voice communication
                with
                high-speed data transmission over broadband;
                and




·
            the
                availability of multiple choices for consumers to receive these advanced
                services, which has led to intensifying competition for subscribers
                and an
                increased focus among BSPs on consumer satisfaction, and the need
                for BSPs
                to rapidly deploy technology and equipment capable of delivering
                advanced
                services to residential and commercial consumers to realize a return
                on
                the significant investments they have made to build and upgrade their
                networks.




Over
      the
      next three years Cancable’s management expects to see its industry change
      significantly for the following reasons:




**Increasing
      Technological Complexity**




Each
      of
      Cancable’s target market segments is experiencing rapid changes in technology.
      The convergence of previously separate technologies has produced newer, more
      complex technologies, such as bundled video, voice and data services. Delivering
      these services requires more highly trained technicians, cross-trained in
      several technologies, to provide installation, integration, fulfillment, and
      long-term maintenance and support services than in the past. For
      example:




·
            *Cable
                Internet access.*High-speed
                internet access requires that cable system operators provide initial
                installation and testing as well as on-going maintenance and support
                of
                new technologies, such as cable modems and network cards.




·
            *VOIP*.
                Cable
                operators are already in the process of utilizing their networks
                for the
                provision of local telephone. This area represents a potentially
                significant source of incremental activity for
                Cancable.




·
            *Convergence
                of video and telecom services****.***Increasingly,
                traditional telecom carriers are entering the field of entertainment
                and
                data delivery, either through strategic investments in alternate
                technologies (see Direct Broadcast Satellite below) or through the
                adaptation of the existing telecom
                infrastructure.




·
            *Direct
                to home Satellite.*Programming
                services require installation of a satellite receiving antenna or
                dish and
                a digital receiver at the consumer premises. In order to facilitate
                high-speed internet access, additional coordination is required between
                the satellite technologies and the standard telephone line modem
                connections that handle outbound communications from the consumer.
                Although certain DTH equipment may be installed by the consumer,
                there is
                a growing trend toward professional installation of satellite
                equipment.




·
            *Premise
                networking.*Premise
                networking requires installation, certification and maintenance of
                high-speed data networks, including LANs/WANs, client/server networks,
                and
                video, audio and security networks meeting stringent industry
                requirements. Substantial resources must be committed to train and
                retain
                field technicians in the new technologies. Cancable believes that
                these
                increasing knowledge and training requirements present a significant
                competitive advantage for larger, well-capitalized enabling companies,
                and
                provide additional motivation for BSPs to rely on independent technology
                enablers thereby avoiding costly investments in internal service
                and
                fulfillment infrastructures.




11




**Increased
      Reliance by BSPs on** **outsourcing**




Technological
      advances and deregulation in the cable, telecommunications, satellite wireless
      and premise networking industries have provided residential and commercial
      consumers with multiple choices for receiving advanced services. The escalating
      competition for end-users has increased competitive pressures on BSPs, which
      is
      requiring them to focus more on consumer satisfaction. The providers' need
      to
      rapidly upgrade and expand existing systems, as a result of increased
      competition and growing demand for advanced services, should lead to a continued
      increase in the level of reliance on independent technology enablers for
      non-core activities, such as installation, integration, fulfillment, and
      long-term maintenance, warranty and support services. Management anticipates
      that BSPs will increase their reliance on independent technology enablers like
      Cancable to the extent that the enablers provide services that are of a higher
      quality and more cost efficient than existing, in-house infrastructure, in
      the
      same way that providers historically have relied on outside sources for other
      ancillary functions, such as design and manufacture of consumer premise
      equipment. Many emerging BSPs, such as DSL and DTH providers, often enter new
      markets where they have little or no local presence and limited resources to
      meet the growing demand for their advanced video, voice and data services.
      These
      providers typically have no in-house service infrastructure. Cancable believes
      these BSPs will continue to rely on independent technology enablers to meet
      their installation and maintenance needs. Cancable believes there will be an
      increased need for higher value-added services as the broadband industry
      continues to evolve and recurring upgrades and value-added improvements become
      more significant. Historically, large corporations with internal information
      technology departments have been primary users for such applications. However,
      the rapidly growing demand for such applications from small to medium-sized
      businesses and residential end-users, which do not have internal deployment
      and
      maintenance capabilities, presents additional growth opportunities for
      independent technology enablers like Cancable.




**Emergence
      of Preferred Providers of Technology Enabling Services** ****




Cancable
      believes that because of the increasing geographic scope of and complexity
      of
      technology deployed by BSPs, there is a growing trend towards long-term,
      strategic alliances with technology enabling companies, in contrast to the
      historic, contractual project-by-project arrangements. Cancable believes that
      its industry is highly fragmented and characterized by smaller, privately held
      companies that offer a limited range of industry-specific services to a small
      number of clients in concentrated geographic areas. In Cancable’s experience,
      BSPs in its target markets who rely on technology enabling companies prefer
      to
      align themselves with larger, better capitalized companies that:




·
            have
                the expertise and resources to deploy and maintain increasingly complex
                technologies over large networks;




·
            consistently
                deliver high quality service;




·
            provide
                regional coverage and have the capacity to work on multiple projects
                simultaneously; and




·
            have
                the ability and willingness to invest in infrastructure to enhance
                the
                deployment and maintenance of the advanced technologies demanded
                by
                residential and commercial customers.




**Industry
      Trends Specific to the Contract Field Technical Support
      Industry**




·
            *Competition
                at the client level.***Some
                of Cancable’s customers are in a monopolistic industrial environment.
                Today, these customers are faced with increasing competition which
                is
                forcing them to adapt the new reality. Part of this adaptation includes
                taking an in-depth review of their internal cost structure to determine
                which services must be performed by employees and which should be
                contracted out, at lower cost.




·
            *Consolidation
                at the client level.***The
                cable television industry in particular has been undergoing a trend
                towards consolidation for many years. This trend has resulted in
                changes
                in the manner in which services are contracted for and has changed
                the
                relationship between client and service provider. Relationships today
                are
                driven less by personal contacts and more by professional qualifications.
                Also important to industry relationships today are the service provider’s
                ability to provide a service level that is uniform across its work
                force
                and to integrate its management and reporting systems with those
                of the
                client.




·
            *Trend
                towards contracting out.*The
                above two drivers are causing cable television and telecommunications
                service providers to move increasingly towards contracting out services
                that are perceived to be non-core but are manageable through sophisticated
                systems and a high level of integration between their own internal
                systems
                and those of the support provider. While not a current client of
                Cancable,
                Bell Canada is leading the trend in this area with almost all of
                its field
                service activities contracted out. Cancable believes that its two
                largest
                clients, Rogers Cable and Cogeco Cable, contract out approximately
                two-thirds of their field installation and service call work. Cancable
                expects that this percentage will continue to increase and that the
                outsourcing trend will spread to these clients’ other field activities
                that are currently not outsourced.




·
            *Consolidation
                among service providers.*As
                an adjunct to consolidation at the client level, larger clients want
                to
                increase efficiency by reducing the number of vendors in each area.
                This
                trend tends to favor those service providers that are able to scale
                up to
                the demands of increased volumes and are able to meet the system
                integration requirements of the
                client.




12





**RISK
      FACTORS**




Described
      below are the material risks that we face. Our business, operating results
      or
      financial condition could be materially adversely affected by, and the trading
      price of our common stock could decline due to, any of these risks.




*Competitive
      pressure from larger firms*




The
      security industry is highly competitive. We compete with a number of large
      international firms, which have more extensive resources than we do. In
      addition, these competitors may have greater brand recognition, proprietary
      technologies and superior purchasing power as well as other competitive
      advantages.




*Risks
      associated with budget constraints and cut back of customer
      spending:*




We
      are
      dependent on large institutional and commercial customers and their budgets.
      If
      there are cut backs in budgets by its customers it will adversely impact our
      revenues.




*Risks
      associated with possible delays of construction schedules*




We
      have
      contracted to provide security systems to a number of new buildings. Delays
      in
      construction of these buildings could potentially delay revenues being
      realized.




*Supplier
      product failures*




We
      do not
      currently manufacture our own products and must purchase products from others.
      It could adversely impact our relationships with our customers if there are
      delays in receiving products from suppliers or if there are defects in these
      products.




*Contracts
      with government agencies may not be renewed or funded*




Contracts
      with government agencies accounts for some of our revenues. Many of these
      contracts are subject to annual review and renewal by the agencies and may
      be
      terminated at any time or on short notice. Each government contract is only
      valid if the agency appropriates enough funds for such contracts. Accordingly,
      we might fail to derive any revenue from sales to government agencies under
      a
      contract in any given future period. In addition, if government agencies fail
      to
      renew or terminate any of these contracts, it would adversely affect our
      business and results of operations.




We
      have a
      small number of customers from which we receive a large portion of our sales.
      Our experience has been that some of these substantial customers will be a
      source of significant sales in the succeeding year and some will not.
      Consequently, we are often required to replace one customer with one or more
      other customers in order to generate the same amount of sales. There can be
      no
      assurance that we will continue to be able to do so.




*Key
      personnel losses*




Competition
      for highly qualified technical personnel is intense and we may not be successful
      in attracting and retaining the necessary personnel, which would limit the
      rate
      at which we can develop products and generate sales. In particular, the
      departure of any of our senior management members or other key personnel could
      harm our business.




*Intellectual
      property protection risks*




Our
      intellectual property might not be protected. No new intellectual property
      has
      been acquired within the last three years. Despite our precautions, it may
      be
      possible for unauthorized third parties to copy our products or obtain and
      use
      information that we regard as proprietary to create products that compete
      against ours. If we fail to protect and preserve our intellectual property,
      we
      may lose an important competitive advantage. In addition, we may from time
      to
      time be served with claims from third parties asserting that our products or
      technologies infringe their intellectual property rights. If, as a result of
      any
      claims, we were precluded from using technologies or intellectual property
      rights, licenses to the disputed third-party technology or intellectual property
      rights might not be available on reasonable commercial terms, or at all. We
      may
      initiate claims or litigation against third parties for infringement of our
      proprietary rights or to establish the validity of our proprietary rights.
      Litigation, either as plaintiff or defendant, could result in significant
      expenses or divert the efforts of our technical and management personnel from
      productive tasks, whether or not the litigation is resolved in our favor. A
      successful claim against us, coupled with our failure to develop or license
      a
      substitute technology, could cause our business, financial condition and results
      of operations to be adversely affected.




13




*We
      may not be able to increase our bonding*




Many
      of
      our government contracts require that we obtain bonding. We may not be able
      to
      increase our bonding and, therefore, we may not be able to pursue larger
      projects as a primary contractor.




*Fluctuation
      in quarterly results*




Our
      quarterly results have varied over the past few years and will likely continue
      to do so. The results will vary based on the timing of the projects,
      construction schedules and customer budgets. Such fluctuations may contribute
      to
      volatility in the market price for our stock.




*Lengthy
      sales cycle*




The
      sale
      of our products and services frequently involves a significant commitment of
      resources to evaluate and propose a project. The approval process for our
      proposals usually involves multiple departments within our clients and may
      take
      several months. Accordingly, depending on the length of recording and processing
      time, a sale can take a prolonged period of time.




*We
      may not be able to successfully make acquisitions or form partnerships as a
      means of fostering our growth*




Our
      growth strategy involves successfully acquiring companies that will add value
      to
      our firm and also build partnerships with companies who can complement our
      core
      competencies. We may not be successful in identifying or consummating
      transactions with such companies.




*Continued
      need for additional financing*




To
      implement our growth plan, we may need additional financing. We will need
      additional financing upon, but not limited to, any of the following
      events:




·
            Changes
                in operating plans




·
            Lower
                than anticipated sales




·
            Increased
                costs of expansion




·
            Increase
                in competition relating to decrease in price




·
            Increased
                operating costs




·
            Potential
                acquisitions




Additional
      financing may not be available on commercially reasonable terms or may not
      be
      available at all.




*Cancable
      Group, one of our major subsidiaries, relies on certain large clients for a
      significant portion of our revenues*




Cancable
      Group currently derives a significant portion of its revenues from a limited
      number of clients. For the fiscal year ended December 31, 2007, Rogers Cable
      TV
      Limited accounted for approximately 60% of Cancable’s revenues. The services
      required by any one client can be limited by a number of factors, including
      industry consolidation, technological developments, economic slowdown and
      internal budget constraints. Cancable Group’s clients are not obligated to
      purchase additional services and most of Cancable’s contracts are cancelable on
      short notice. As a result of these factors, the volume of work performed for
      specific clients is likely to vary from period to period and a major client
      in
      one period may not use Cancable’s services to the same degree in a subsequent
      period. A temporary or permanent loss of any of Cancable’s key clients could
      seriously harm its business. If any cancelled contracts were not replaced with
      contracts from other clients, Cancable’s revenues might decrease and its
      profitability could be adversely affected.




14




*Cancable
      will be adversely affected by a decline in the growth of the cable and telecom
      industries*




The
      broadband communications industry has experienced a high rate of growth. If
      the
      rate of growth slows, and broadband service providers reduce their capital
      investments in upgrades or expansion of their systems, Cancable’s clients may
      not require the same volume of services from Cancable and it may not be able
      to
      execute its growth strategy. In that case, Cancable’s profitability and its
      prospects could be adversely affected.




*Our
      clients may not rely on the Contract Field Technical Support services we
      provide*




Cancable’s
      success is dependent on the continued reliance by BSPs on independent companies
      like Cancable for performance of their installation, integration, fulfillment,
      and long- term maintenance and support services. If these providers elect to
      perform these services themselves, Cancable’s revenues may decline and its
      business could be harmed.




*Consolidation
      of broadband service providers could result in fewer and smaller customers
      for
      us*




The
      cable, telecommunications, satellite and wireless industries could experience
      significant consolidation activity. In addition, the consolidation of Cancable’s
      clients could have the effect of reducing the number of its current or potential
      clients, which could result in Cancable’s dependence on a smaller number of
      clients.




*Cancable
      may face reduced customer demand due to new technologies*




Cancable’s
      industry is subject to rapid changes in technology. Existing technologies for
      transmission of video, voice and data are subject to potential displacement
      by
      various new technologies. New technologies may be developed that allow broadband
      service providers to deliver their services to consumers without a significant
      upgrade of their existing systems. Furthermore, new technologies may be
      developed that enable consumers to perform more easily their own installation
      and maintenance of the equipment required for the delivery of these services
      at
      their premises. Cancable will need to be able to enhance its current service
      offerings to keep pace with technological developments and to address
      increasingly sophisticated client needs. Cancable may not be successful in
      developing and marketing service offerings that respond to technological
      advances in a timely manner, and its services may not adequately or
      competitively address the needs of the changing marketplace. If Cancable is
      not
      successful in responding in a timely manner to technological changes, market
      conditions and industry developments, it may lose current clients or be unable
      to obtain new clients and its business, prospects, operating results and
      financial condition could suffer.




*Cancable
      may not be able to compete on price with our competitors*




Cancable’s
      industry is fragmented and highly competitive. Accordingly, it cannot be assured
      of being able to maintain or enhance its competitive position. Historically,
      there have been relatively few barriers to entry into the markets in which
      Cancable operates. As a result, any organization that has adequate financial
      resources and access to technical expertise may become one of our competitors.
      Competition in the industry depends on a number of factors, including price.
      Cancable’s competitors may have lower cost structures and may, therefore, be
      able to provide their services at lower rates than it can. Cancable also faces
      competition from the in-house service organizations of its existing or
      prospective clients, which often employ personnel who perform some of the same
      types of services as it does. If Cancable is unable to maintain or enhance
      its
      competitive position, its business, prospects, operating results and financial
      condition may suffer materially.




*Cancable
      may face an inability to attract and retain qualified employees*




Cancable’s
      ability to provide high-quality services on a timely basis requires that it
      employ an adequate number of field technicians. Accordingly, its ability to
      meet
      the demand for its services will be limited by Cancable’s ability to attract,
      train and retain skilled personnel. Cancable’s industry is characterized by
      highly competitive labor markets and, like many of its competitors, historically
      Cancable has experienced high rates of employee turnover. Furthermore, its
      labor
      expenses may increase as a result of a shortage in the supply of skilled
      personnel and its efforts to improve its employee retention, which could
      adversely impact its profitability. Cancable cannot be certain that it will
      be
      able to improve its employee retention rates or maintain an adequate skilled
      labor force necessary to operate efficiently and to support its growth strategy.
      Failure to do so could impair its ability to operate efficiently and maintain
      its reputation for high quality service. This could also impair Cancable’s
      ability to retain current clients and attract new clients that could cause
      its
      financial performance to decline.




15




*Mismatch
      of Staffing Levels and Contract Requirements*




Since
      Cancable’s business is driven by large, and sometimes multi-year contracts,
      Cancable forecasts its personnel needs for future projected business. If
      Cancable increases its staffing levels in anticipation of a project that is
      subsequently delayed, reduced or terminated, it may underutilize these
      additional personnel, which would increase its expenses and could harm its
      business.




*Cancable
      relies on key senior employees and management*




Cancable’s
      success is substantially dependent upon the retention of, and the continued
      performance by, its senior management and other key employees, including key
      employees of companies that it may acquire in the future. If any member of
      Cancable’s senior management team becomes unable or unwilling to participate in
      its business and operations and it is not able to replace them in a timely
      manner, its business could suffer. Cancable does not maintain "key man" life
      insurance policies on any member of its senior management or any of its key
      employees.




*Cancable
      is a growing business and may require additional financing which may not be
      available to us*




Cancable
      may require additional financing, including access to a bank operating line
      and
      lease financing for vehicles, to fully implement its business strategy in a
      timely manner. Cancable’s future requirements will depend on many factors,
      including continued progress in its client development and expansion programs.
      There can be no assurance that additional funding will be available or, if
      available, that it will be available on acceptable terms. If such funding is
      not
      available, Cancable may be forced to reduce or eliminate expenditures for
      further development of its proposed new initiatives and contemplated
      acquisitions. There can be no assurance that Cancable will be able raise
      additional capital if its capital resources are exhausted. Cancable’s ability to
      arrange such financing in the future will depend in part upon prevailing capital
      market conditions as well as its business performance. Failure to obtain such
      financing could delay implementation of Cancable’s strategy and could have a
      material adverse effect on its ability to successfully develop its business.
      Such financing, if available, could result in dilution to existing
      shareholders.




*We
      have issued a substantial number of warrants and options and other convertible
      securities, which may cause the trading price of our securities to decline
      and
      may limit our ability to raise capital from other sources:*




As
      of
      December 31, 2007, there were 7,309,596 shares of common stock issuable upon
      the
      exercise of warrants and 3,351,155 shares issuable upon the exercise of options.
      3,222,000 shares were related to the Employee Stock Options (see Note 13 in
      the
      Financial Statements). Also, included in the balance, 6,570,096 shares of common
      stock issuable upon the exercise of warrants and 129,155 shares issuable upon
      the exercise of options were issued to Laurus Master Fund, Ltd (“Laurus”).
      Additionally, there were 49 shares of common stock of Cancable issuable upon
      the
      exercise of options and 20 shares of common stock of Iview issuable upon the
      exercise of options to Laurus. While these securities are outstanding, the
      holders will have the opportunity to profit from a rise in the price of our
      securities with a resulting dilution (upon exercise or conversion) in the value
      of the interests of our other security holders. Our ability to obtain additional
      financing during the period these convertible securities are outstanding may
      be
      adversely affected and their existence may have a negative effect on the price
      of our securities. We may be obligated to issue additional shares in payment
      of
      accrued interest on our term notes as a result of adjustments to the conversion
      or exercise prices of our convertible securities. Additional shares of our
      common stock may be issued if additional amounts are funded under our existing
      financing arrangements with Laurus or if we obtain additional financings in
      the
      future. The happening of certain events such as stock splits, reverse stock
      splits, stock dividends or certain additional share issuances at prices below
      the then effective exercise or conversion price would trigger an adjustment
      in
      the exercise or conversion price (as applicable). The adjustment would be based
      upon a weighted average formula in the case of below exercise or conversion
      price issuances. The adjustment will depend on the number of shares issued
      and
      the difference between the issuance price and the then effective exercise or
      conversion price. Since no such transactions are currently contemplated, it
      is
      not presently possible to quantify possible future adjustments. The holders
      of
      these securities are likely to exercise them at a time when we would, in all
      likelihood, be able to obtain any needed capital by a new offering of securities
      on terms more favorable to us than those of the outstanding warrants and
      options.




16




*Because
      our directors own approximately 83% of our outstanding common shares, they
      could
      make and control corporate decisions that may be disadvantageous to minority
      shareholders*




Our
      directors own approximately 83% of the outstanding common shares. Accordingly,
      they will have a significant influence in determining the outcome of all
      corporate transactions or other matters, including mergers, consolidations
      and
      the sale of all or substantially all of our assets, and also the power to
      prevent or cause a change in control. The interests of our directors may differ
      from the interests of the other shareholders and thus result in corporate
      decisions that are disadvantageous to other shareholders.




*Exchange
      rate fluctuations may have adverse effects on our revenues*




A
      portion
      of our revenues and expenses are denominated in Canadian dollars. As a result,
      we will be exposed to currency exchange rate risk. Our reported earnings could
      fluctuate materially as a result of foreign exchange rate fluctuations.




*Our
      substantial debt could adversely affect our financial position*




Our
      substantial indebtedness could have important consequences to you. Our annual
      debt service requirements related to payments of principal on our $15,805,777
      principal amount of term notes are approximately $2,240,356, $6,700,000,
      $100,000 and $6,765,421 from 2008 to 2011. In addition, interest on the notes
      is
      payable on a monthly basis. We also have a series of other notes payable
      totaling $1,803,030 as of December 31, 2007. The $1,500,000 promissory note
      included in other notes payable, which were issued by Creative Vistas
      Acquisition to The Burns Trust and The Navaratnam Trust in connection with
      the
      acquisition of AC Technical, have no fixed term of repayment. The note payable
      was transferred to Malar Trust during Fiscal Year 2006 with the same payment
      term. The remaining balance of other notes payable in the amount of $303,030
      was
      issued by Cancable Inc. for the acquisition of XL Digital Services Inc. The
      balance is due in January 2008. The term notes are secured by all of our assets.
      Interest on term notes are settled in cash. However, in the event we are unable
      to generate sufficient cash flow from our operations, we may face difficulties
      in servicing our substantial debt load. In such event, we could be forced to
      seek protection from our creditors, which could cause the liquidation of the
      Company in order to repay the secured debt. In any liquidation of us, the
      holders of our debt (including The Malar Trust) would be required to be paid
      in
      full before any payments could be made to the holders of our common stock.
      In
      addition, our outstanding indebtedness could limit our ability to obtain any
      additional financing.




*There
      is no active trading market in our securities*




Although,
      our common stock is quoted on the NASD OTC Bulletin Board, there is no active
      trading in the stock. A trading market may not develop and stockholders may
      not
      be able to liquidate their investment without considerable delay. If a market
      should develop, the price of our stock may be highly volatile.




*Penny
      Stock regulations apply to our securities:*




Our
      securities are subject to the “penny” stock regulation of Rule 15g-9 of the
      Securities Exchange Act of 1934. Rule 15g-9 of the Exchange Act is commonly
      referred to as the “penny stock” rule and imposes special sales practice
      requirements upon broker-dealers who sell such securities to persons other
      than
      established customers or accredited investors. A penny stock is any equity
      security with a market price less than $5.00 per share, subject to certain
      exceptions. Rule 3a51-1 of the Exchange Act provides that any equity security
      is
      considered a penny stock unless that security is: registered and traded on
      a
      national securities exchange and meets specified criteria set forth by the
      SEC;
      authorized for quotation in the National Association of Securities Dealers’
Automated Quotation System; issued by a registered investment company; issued
      with a price of five dollars or more; or issued by an issuer with net tangible
      assets in excess of $2,000,000. This rule may affect the ability of
      broker-dealers to sell our securities.




For
      transactions covered by Rule 15g-9, a broker-dealer must furnish to all
      investors in penny stocks a risk disclosure document, make a special suitability
      determination of the purchaser, and receive the purchaser’s written agreement to
      the transaction prior to the sale. In order to approve a person’s account for
      transactions in penny stocks, the broker-dealer must (i) obtain information
      concerning the person’s financial situation, investment experience, and
      investment objectives; (ii) reasonably determine, based on that information
      that
      transactions in penny stocks are suitable for the person and that the person
      has
      sufficient knowledge and experience in financial matters to reasonably be
      expected to evaluate the transactions in penny stocks; and (iii) deliver to
      the
      person a written statement setting forth the basis on which the broker-dealer
      made the determination of suitability stating that it is unlawful to effect
      a
      transaction in a designated security subject to the provisions of Rule
      15g-9(a)(2) unless the broker-dealer has received a written agreement from
      the
      person prior to the transaction. Such written statement from the broker-dealer
      must also set forth, in highlighted format immediately preceding the customer
      signature line, that the broker-dealer is required to provide the person with
      the written statement and the person should sign and return the written
      statement to the broker-dealer only if it accurately reflects the person’s
      financial situation, investment experience and investment
      objectives.




17




*Losing
      our status as a Canadian Controlled Private Corporation*  *could
      adversely affect our financial position* :




A
      Canadian Controlled Private Corporation (“CCPC”) is a corporation that is not
      controlled by a non-Canadian entity. If, in the future, more than 50% of the
      voting shares of AC Technical are owned by a non-Canadian entity, such as by
      Laurus exercising its rights under the Share Pledge Agreement, we would lose
      our
      status as a CCPC. Unless a company is a CCPC, it is not eligible for certain
      Canadian research and development tax credits. As a non-CCPC, the maximum
      Canadian research and development tax credits are 20% (for both Federal and
      Provincial Canadian taxes) of total eligible research and development
      expenditures. AC Technical is presently entitled to claim the maximum credits
      available to CCPCs of 41.5% (for both Federal and Provincial Canadian taxes)
      of
      the total eligible expenditures. During Fiscal Year 2007, this extra 21.5%
      totaled approximately $100,000.




**Available
      Information**




We
      file
      annual, quarterly and current reports, proxy statements and other information
      with the U.S. Securities and Exchange Commission ("SEC"). Copies of this Annual
      Report on Form 10-KSB and each of our other periodic and current reports, and
      amendments to all such reports, that we file or furnish pursuant to Section
      13(a) or 15(d) of the Securities Exchange Act of 1934 are available free of
      charge on our website (http://www.creativevistasinc.com/) as soon as reasonably
      practicable after the material is electronically filed with, or furnished to,
      the SEC. The information contained on our website is not incorporated by
      reference into this Annual Report on Form 10-KSB and should not be considered
      part of this Annual Report on Form 10-KSB.




In
      addition, you may read and copy any document we file with the SEC at the SEC's
      Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. Please
      call
      the SEC at 1-800-SEC-0330 for further information on the operation of the Public
      Reference Room. Our SEC filings are also available to the public at the SEC's
      web site at http://www.sec.gov , which contains reports, proxy and information
      statements, and other information regarding issuers that file electronically
      with the SEC.




**Item
              2.**
            **Description
                of Property**




Our
      office is located at 2100 Forbes Street, Units 8-10, Whitby, Ontario, Canada
      L1N
      9T3. The premises, which were purchased in 2002, consist of approximately 5,900
      square feet on the ground floor and 2,200 square feet on the second floor.
      Additionally, we have another major office location at 2321
      Fairview St. Burlington, Ontario L7R 2E3. The premise, which was rented in
      2003,
      consist of approximately 7,600 square feet. The lease will be expired in 2009
      with lease payment approximately $77,900 per year. We
      believe that these offices are adequate for our present purposes and planned
      expansion. Furthermore, we believe these offices are in good condition and
      adequately covered by insurance.




**Item
              3.**
            **Legal
                Proceedings**




None.




**Item
              4.**
            **Submission
                of Matters to a Vote of Security
                Holders**




No
      matters were submitted to security holders during the fourth quarter of the
      fiscal year covered by this report.




**Item
              5.**
            **Market
                for the Registrant's Common Equity, Related Stockholder Matters and
                Issuer
                Purchases of Equity
                Securities**




Our
      common stock is quoted at the present time on the OTC Bulletin Board under
      the
      symbol “CVAS.” At December 31, 2007, the bid price was $2.56 per share and
      the ask price was $2.80 per share. The security is subject to Section 15(g)
      and
      Rule 15g-9 of the Securities Exchange Act of 1934, commonly referred to as
      the
      penny stock rule. See “Risk Factors—Penny Stock.” The following table shows the
      range of bid prices per share of common stock on the OTC Bulletin Board, as
      reported by Pink Sheets LLC, for the periods indicated. These quotations
      represent prices between dealers, do not include retail mark-ups, mark-downs
      or
      commissions, and do not necessarily represent actual transactions.




18




Quarter
                  ended:
              
              Low
                  Bid Price
              
              High
                  Bid PriceMarch
                  31, 2006
              
              $
              0.35
              
              $
              0.86June
                  30, 2006
              
              $
              0.31
              
              $
              0.86September
                  30, 2006
              
              $
              0.15
              
              $
              0.70December
                  31, 2006
              
              $
              0.15
              
              $
              0.50March
                  31, 2007
              
              $
              0.29
              
              $
              1.25June
                  30, 2007
              
              $
              0.70
              
              $
              2.60September
                  30, 2007
              
              $
              1.95
              
              $
              3.07December
                  31, 2007
              
              $
              2.05
              
              $
              2.88


Our
      securities may not qualify for listing on Nasdaq or any other national exchange.
      Even if our securities do qualify for listing, we may not be able to maintain
      the criteria necessary to ensure continued listing. Our failure to qualify
      our
      securities or to meet the relevant maintenance criteria after such qualification
      may result in the discontinuance of the inclusion of our securities on a
      national exchange. In such event, trading, if any, in our securities may then
      continue in the non-Nasdaq, over-the-counter market so long as we continue
      to
      file periodic reports with the SEC and there remain sufficient qualified market
      makers in our securities. As a result, a stockholder may find it more difficult
      to dispose of, or to obtain accurate quotations as to the market value of,
      our
      securities.




We
      have
      not declared or paid any cash dividends.




As
      of
      December 31, 2007 there were 271 beneficial holders of our Common Stock. We
      have 34,494,623 outstanding shares of Common Stock.




Our
      agreements with Laurus prohibit us from declaring or paying any dividends on
      our
      Common Stock.




**Item
                  6.**
                **Selected
                    Financial Data**




**Not
      applicable.**




**Item
              7.**
            **Management’s
                Discussion and Analysis**




**MANAGEMENT’S
      DISCUSSION AND ANALYSIS OR PLAN OF OPERATION**




The
      following discussion of the financial condition and results of operations should
      be read in conjunction with the consolidated financial statements and related
      notes thereto. The following discussion contains certain forward-looking
      statements that involve risks and uncertainties. Our actual results could differ
      materially from those discussed therein. Factors that could cause or contribute
      to such differences include, but are not limited to, risks and uncertainties
      related to the need for additional funds, the rapid growth of the operations
      and
      our ability to operate profitably a number of new projects. Except as required
      by law, we do not intend to publicly release the results of any revisions to
      those forward-looking statements that may be made to reflect any future events
      or circumstances.




**Overview
      and Recent Developments**




In
      October 2007, the Company entered into an agreement, through our wholly owned
      newly formed Ontario subsidiary, Cancable XL Inc. (“Cancable XL”), to acquire
      all of the issued and outstanding shares of capital stock and any other equity
      interests of XL Digital Services Inc. (“XL Digital”), an Ontario corporation. The
      total
      consideration to be paid by Cancable XL Inc. for the shares of XL Digital will
      be an amount equal to the earnings before interest, taxes, depreciation and
      amortization derived from the carrying on of its business by XL
      Digital for the twelve month period after the completion of the acquisition
      times 2.5.




19




On
      January 22, 2008, the Company entered into a Stock Purchase Agreement (the
      “Stock Purchase Agreement”) with Erato Corporation (“Erato”) pursuant to which
      the Company purchased and acquired from Erato 2,674,407 shares of common stock,
      par value $0.0001 per share (the “Shares”), of 180 Connect Inc., a Delaware
      corporation, for an aggregate purchase price of $6,017,416 paid by the Company
      by delivery to Erato of (i) 2,195,720 duly and validly issued shares of common
      stock of the Company and (ii) a common stock purchase warrant, exercisable
      into
      up to 812,988 shares of common stock of the Company at an exercise price of
      $0.01 per share.




On
      January 22, 2008 the Company entered into a letter agreement with Erato for
      Erato to provide up to Twelve Million Dollars ($12,000,000) in financing to
      the
      Company on such terms and conditions as the Company and Erato shall mutually
      agree (the “Bridge Financing”). All proceeds from the Bridge Financing may only
      be used by the Company for the purpose of financing a third party. The Company
      does not currently have an agreement to provide financing to such third party.
      Erato is currently an investor in such third party and, through its parent,
      Laurus Master Fund Ltd., a current investor in the Company. In consideration
      of
      the letter agreement, the Company issued to Erato a warrant to purchase up
      to
      1,738,365 shares of common stock of the Company at an exercise price of $0.01
      per share.




On
      January 30, 2008, the Company entered into a Warrant Purchase Agreement with
      Laurus Master Fund, Ltd., Erato Corporation, Valens U.S. Fund, LLC and Valens
      Offshore SPV I, Ltd. (collectively, the “Sellers”) pursuant to which the Company
      purchased and acquired from the Sellers, warrants to purchase 450,000 shares
      of
      common stock at an exercise price of $0.01 per share of 180 Connect Inc., a
      Delaware corporation (the “180 Connect Warrants”).




Also
      on
      January 30, 2008, the Company entered into a non-binding letter of intent with
      Valens U.S. Fund, LLC (the “Letter Agreement”) in which Valens U.S. Fund, LLC
      confirmed its current intention to provide up to $4,000,000 in financing to
      a
      subsidiary of the Company. The Letter Agreement is only an expression of the
      present intentions of the parties and no binding legal obligation will exist
      until the parties sign a definitive agreement.




The
      aggregate purchase price paid by the Company in exchange for the 180 Connect
      Warrants and the Letter Agreement was $1,597,500 paid by the Company by delivery
      to the Sellers of common stock purchase warrants, exercisable in the aggregate
      into up to 798,750 shares of common stock of the Company at an exercise price
      of
      $0.01 per share. The purchase price was allocated by the Company as follows:
      (a)
      $1,012,500 or $2.25 per share was paid by the Company for the 180 Connect
      Warrants by delivery to the Sellers of warrants to purchase 506,250 shares
      of
      common stock of the Company at an exercise price of $0.01 per share and (b)
      the
      Company paid to the Sellers for the Letter Agreement warrants to purchase
      292,500 shares of common stock of the Company.




**Results
      of Operations**




**Comparison
      of Year Ended December 31, 2007**




**to
      Year Ended December 31, 2006**




**Sales** :
      Sales
      for Fiscal Year 2007 increased to $39,991,100 from $30,456,900 for Fiscal Year
      2006. This 31.3% increase reflects continued growth in revenue resulting from
      Cancable segment. The revenue from Cancable segment was $32,316,400 for Fiscal
      Year 2007.




20




**(a)
      Cancable Segment** -
      This
      segment included Cancable Inc., XL Digital and OSS-IM View (collectively,
“Cancable Group”). The principal activity is the provisioning the deployment and
      servicing of broadband technologies in both residential and commercial markets.
      The Cancable Group service offering, network deployment, IT integration, and
      support services, enable the cable television and telecommunications industries
      to deliver a high quality broadband experience to their customers. In October
      2007, we acquired XL Digital which is incorporated under the laws of Ontario
      and
      with the same principal business activity of Cancable Inc. XL Digital, with
      over
      70 employees, provides its deployment and provisioning services for Rogers
      Cable
      Inc. within two territories where the Company currently does not have a
      presence.  Total
      revenue of this segment for Fiscal Year 2007 was $32,316,400 from $23,779,400
      for the Fiscal Year 2006. We continued to allocate resources to support the
      growth of our business. Rogers Cable Inc. is Cancable Group’s largest customer
      and the revenue from this customer for the Fiscal Year 2007 was approximately
      $24,397,000 or 75.5% of its total revenue compared to $18,695,200 or 78.6%
      for
      Fiscal Year 2006.




**(b)
      AC Technical segment** -
      Total
      revenue of AC Technical segment was $7,531,300 compared to $6,492,200 for Fiscal
      Year 2006. Contract revenue increased to $5,986,900 for Fiscal Year 2007
      compared to $5,229,000 for Fiscal Year 2006. This increase was mainly due to
      an
      increase in the number of subcontracts for the provision of services to
      government and commercial contracts. Contract revenue from three of our major
      customers was $1,295,400 in 2007. Two major contracts for Fiscal Year 2007
      were
      to supply and install two court houses in Canada. Total contract price of these
      two projects were approximately $1,200,000. The service revenue has increased
      to
      $1,544,400 for the year ended December 31, 2007 from $1,282,000 for the year
      ended December 31, 2006. Service revenue primarily represents the cumulative
      effect of the growth in contracts and number of customers over the past few
      years. We have experienced a significant increase in the number of inquiries
      for
      systems from the government and retail sector. This increased interest in
      security products and services may result in our achieving increased revenues
      in
      future periods if we are successful in attracting new customers or obtaining
      additional projects from existing customers. There is no assurance that the
      Company will be able to attract new customers.




**(c)
      Iview DSI segment** -
      Iview
      is a technology company that specializes in both security and digital video
      processing technologies. Expertise in both these areas enables us to address
      a
      broad spectrum of our customers' needs with intelligent and most importantly,
      reliable digital video security solutions. Total revenue for Fiscal Year 2007
      was $140,000 compared to $157,600 for Fiscal Year 2006. Iview launched its
      digital video security product in Fiscal Year 2006.




Cost
      of Goods Sold :
      Cost of
      goods sold as a percentage of revenue for Fiscal Year 2007 was $28,329,200
      or
      70.8% of revenues compared to $20,511,000 or 67.3% of revenues for Fiscal Year
      2006.




**(a)
      Cancable segment** -
      Cost of
      sales in this segment were $24,126,000 for Fiscal Year 2007 compared to
      $16,981,000 for Fiscal Year 2006. The increase was mainly due to the growth
      in
      our cable business. Costs were comprised principally of labor expenses of
      $18,368,900, vehicle expenses of $2,246,500 and material costs of $2,522,500.




**(b)
      AC Technical segment** -
      Cost of
      sales in this segment were $4,136,700. The material cost was $2,657,700 or
      35.3%
      of the AC Technical revenue for Fiscal Year 2007 compared to $2,053,800 or
      31.5%
      of revenues in Fiscal Year 2006. The increase in percentage of the material
      cost
      was mainly due to some contracts with higher percentage of materials. On
      the
      other hand, labor and subcontractor costs decreased to $1,414,900 or 18.8%
      of AC
      Technical revenues for Fiscal Year 2007 and $1,322,600 or 20.3% of AC Technical
      revenues for Fiscal Year 2006. The increase in labor and subcontractor cost
      was
      mainly due to the increase in revenue. The percentage of the labor and
      subcontractor cost remains stable for two fiscal years.




**(c)
      Iview DSI** - Cost
      of sales in this segment was $66,500. The balance mainly represents material
      and
      shipping cost.




Project,
      Selling, General and Administrative Expenses :
      Projects, selling, general and administrative expenses for Fiscal Year 2007
      was
      $10,169,800 or 25.4% of revenues for Fiscal Year 2007 compared to $9,143,500
      or
      30.0% of revenues for Fiscal Year 2006. The balance is mainly comprised of
      the
      following:




Project
      cost was $1,311,600 or 3.2% of revenue for Fiscal Year 2007, compared to
      $1,272,900 or 4.2% for fiscal year 2006. Project cost was mainly related to
      AC
      Technical segment. The balance mainly includes the salaries and benefits of
      indirect staff amounting to $758,000 for Fiscal Year 2007 compared to $808,200
      for Fiscal Year 2006 with no material difference. The decrease in balance was
      mainly due to the decrease in the staff headcount. The automobile and travel
      expenses were approximately $309,700 for Fiscal Year 2007 compared to $351,400
      for Fiscal Year 2006. The decrease in balance was mainly due to less travel
      by
      the staff, a decrease in the number of vehicles, and a decrease in leasing
      cost.




21




Selling
      expenses were $797,800 or 2.0% of revenues for Fiscal Year 2007 compared to
      $679,600 or 2.2% of revenues for Fiscal Year 2006. Selling expenses were mainly
      related to AC Technical segment. As of December 31, 2007 we had 5 salespersons
      in the AC Technical segment, which is one more than we had on December 31,
      2006.
      The balance for Fiscal Year 2007 is mainly comprised of salaries and commissions
      to salespersons of $504,000 compared to $540,600 for Fiscal Year 2006. The
      advertising, promotion and trade show expenses were $84,100 for Fiscal Year
      2007
      compared to $71,100 for Fiscal Year 2006 with no material
      fluctuation.




General
      and administrative expenses were $8,060,400 or 20.2% of revenues for Fiscal
      Year
      2007 compared to $7,191,000 or 23.6% for Fiscal Year 2006. The balance for
      Fiscal Year 2007 is comprised of $850,000 of investor relations expenses
      compared to $486,300 fees for Fiscal Year 2006. Included in the balance for
      Fiscal Year 2007, there was $626,000 relating to non-cash expenses compared
      to
      $356,300 for the Fiscal Year 2006. Total salaries and benefits to administrative
      staff were $2,553,700 for Fiscal Year 2007 compared to $2,683,400 for last
      year.
      Total depreciation of property plant and equipment was $1,685,200 for Fiscal
      Year 2007 compared to $986,500 for Fiscal Year 2006. The increase was primarily
      attributable to the addition of capital assets in Cancable segment for the
      growth of the business. Additionally, the balance also included amortization
      of
      intangible assets in the amount of $637,500 for Fiscal Year 2007 compared to
      $600,000 for Fiscal Year 2006.




Interest
      and Other Expenses (Income) :
      Interest and net other expenses for Fiscal Year 2007 was $2,073,700 compared
      to
      interest and other expenses of $6,344,200 for Fiscal Year 2006. The balance
      for
      Fiscal Year 2007 included amortization of deferred charges of $182,400 compared
      to $782,900 for Fiscal Year 2006. Last year’s balance was higher as we have
      written off the deferred financing costs amounting to $600,500 carried forward
      from Fiscal Year 2005. The Company has paid off the entire outstanding principal
      amount and all obligations due to Laurus under the Secured Convertible Term
      Note
      dated September 30, 2004, the Secured Convertible Minimum Borrowing Note dated
      September 30, 2004, and the Secured Revolving Note dated September 30, 2004
      through a refinancing transaction in February 2006. Additionally, net financing
      expenses decreased to $2,955,100 or 7.3% of revenues compared to 4,617,800
      or
      15.2% of revenues for Fiscal Year 2006. The balance for Fiscal Year 2007
      included $895,000 related to the warrants issued to Laurus as interest on
      deferred principal repayment of our term loan. Last year’s balance was higher as
      it included the 2,411,003 warrants issued to Laurus with market value of
      $1,913,600 at the date of issuance, and cash payments of $539,300 as the
      penalties of the prepayment of the entire loans to Laurus in the refinancing
      transaction. Interest payable to term notes was $1,645,100 for Fiscal Year
      2007
      compared to $1,683,900 for the Fiscal Year 2006. The decline in balance was
      due
      to the decrease in the outstanding balance of term notes to $15,805,800 as
      at
      December 31, 2007 from $16,869,900 as at December 31, 2006.




Income
      taxes :
      There
      is no income tax provision for Fiscal Year 2007, which was mainly due to losses
      carried forward to offset all income generated. All prior taxes have already
      been accounted for in the income tax recoverable and therefore, there is no
      additional provision for income taxes recoverable and deferred tax
      assets.




Net
      Income/Loss :
      As a
      result of the above, net loss for Fiscal Year 2007 was $581,600 compared to
      a
      net loss of $5,541,900 for Fiscal Year 2006. Our operating income was $1,492,100
      for Fiscal Year 2007 compared to operating income $802,300 for Fiscal Year
      2006.
      The increase was primarily attributed to the significant growth of Cancable
      and
      a decrease in financing costs.




22




**Liquidity
      and Capital Resources**




Since
      our
      inception, we have financed our operations through bank debt, loans and equity
      from our principals, loans from third parties and funds generated by our
      business. At December 31, 2007, we had $1,960,300 in cash. We believe that
      cash
      from operations and our credit facilities with Laurus will continue to be
      adequate to satisfy our ongoing working capital needs. During Fiscal Year 2008,
      our primary objectives in managing liquidity and cash flows will be to ensure
      financial flexibility to support growth and entry into new markets and improve
      inventory management and to accelerate the collection of accounts
      receivable.




Net
      Cash Used in Operating Activities .
      Net
      cash provided in operating activities amounted to $564,200 for Fiscal Year
      2007.
      The changes in operating assets and liabilities resulted in net cash provided
      of
      $2,138,500, which included a $1,668,900 increase in accounts receivable, a
      $184,200 increase in inventory, a $59,600 decrease in prepaid expenses, a
      $322,400 decrease in accounts payable, a $33,400 decrease in income taxes
      recoverable and a $11,000 increase in deferred revenue.




Comparative
      balance sheet as at December 31, 2007 to December 31, 2006




Accounts
      Receivable




Our
      accounts receivable increased to $6,187,600 as of December 31, 2007 from
      $3,864,100 as of December 31, 2006. A ccounts
      receivable of Cancable as at December 31, 2007 was $3,989,100 compared to
      $1,799,500 as at December 31, 2007. The increase was attributable to the
      increase in revenue for approximately 36%. Accounts receivable of the AC
      Technical segment was $2,083,200 as at December 31, 2007 compared to $2,040,800
      as of December 31, 2006. There was no material fluctuation of the
      balances.




Inventory




Inventory
      on hand on
      December 31, 2007 increased to $1,043,800 compared to $764,100 as of
      December 31, 2006. Inventory of the AC Technical segment was $639,000
      compared to $430,300 as of December 31, 2005. The increased level of inventory
      of the AC Technical segment was associated with more purchases were
      required for the sales expected in the first quarter of 2008. Inventory at
      Cancable segment was increased to $363,600 as at December 31, 2007 from $250,400
      as at December 31, 2006. The increase was mainly due to the increase in
      revenue.




Accounts
      Payable and Accrued Liabilities




Accounts
      payable and accrued liabilities increased to $6,074,200 compared to the balance
      as of December 31, 2006 of $4,655,000. The balance for the AC Technical segment
      was $2,245,000 as of December 31, 2007 compared to $1,826,000 as of December
      31,
      2006. Accounts payable for Cancable Group was $3,348,000 as at December 31,
      2007
      compared to $2,480,000 as at December 31, 2006. The increase in balance was
      mainly due to the increase in purchases of material in the last three months
      and
      the timing of payments to our suppliers.




Deferred
      Revenue




Deferred
      revenue increased to $91,900 at December 31, 2007 compared to the balance of
      $68,300 as at December 31, 2006. This increase was mainly due to the timing
      of
      payments by our customers. Deferred revenue primarily relates to payments
      associated with the contracts where revenue is recognized on a percentage of
      completion basis. (See summary of accounting policy in our condensed
      consolidated financial statements).




Incomes
      Taxes Recoverable




The
      income taxes recoverable were mainly due to the expected refund from losses
      carried back to prior years.




Net
      Cash Used in Investing Activities .
      Net
      cash used in investing activities was $719,200 for the twelve months ending
      December 31, 2007 compared to net cash received in investing activities of
      $1,209,500 for the twelve months ended December 31, 2006. The balance for the
      twelve months ending 2007 was mainly related to the acquisition of capital
      assets. Last year’s balance was mainly related to cash received during the
      acquisition of Cancable in the amount of $1,226,800 and proceeds of sales of
      property and equipment in the amount of $454,400.




Net
      Cash Used in Financing Activities .
      Net
      cash used in financing activities was $1,394,800 for the twelve months
      ending December 31, 2007 compared to net cash provided of $887,500 for the
      12
      months ending December 31, 2006. Last year’s balance mainly represents the
      additional borrowings from Laurus from the refinancing transaction in 2006.
      The
      whole entire revolving loans and convertible debts entered in 2004 were repaid
      during the same period.




23




Our
      capital requirements have grown since our inception with the growth of our
      operations and staffing. We expect our capital requirements to continue to
      increase in the future as we seek to expand our operations. On September 30,
      2004, we obtained additional funding through a series of agreements with Laurus.
      In 2006, through our wholly owned subsidiary, we acquired
      all of the issued and outstanding shares of capital stock and any other equity
      interests of Cancable. Simultaneously, Cancable entered into a series of
      agreements with Laurus whereby Cancable issued to Laurus a secured term note
      (the “Cancable Note”) in the amount of $6,865,000. Also, we completed the
      refinancing transaction in February 2006; we
      issued
      to Laurus a secured term note (the “Company Note”) in the amount of $8,250,000,
      Iview DSI issued to Laurus a secured term note (the “Iview Note”) in the amount
      of $2,000,000. Simultaneously with the closing of this refinancing transaction,
      we paid off the entire outstanding principal amount and all obligations due
      to
      Laurus under the Secured Convertible Term Note dated September 30, 2004, the
      Secured Convertible Minimum Borrowing Note dated September 30, 2004 and the
      Secured Revolving Note dated September 30, 2004 (collectively, the “2004 Notes”)
      and such 2004 Notes were subsequently cancelled.




Over
      the
      next twelve months we believe that our existing capital will be sufficient
      to
      sustain our operations. Management plans to seek additional capital in the
      future to fund operations, growth and expansion through additional equity,
      debt
      financing or credit facilities. We have had early stage discussions with
      investors about potential investment in our firm at a future date. No assurance
      can be made that such financing would be available, and if available it may
      take
      either the form of debt or equity. In either case, the financing could have
      a
      negative impact on our financial condition and our shareholders.




***Recent
      Accounting Pronouncements***




In
      September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements.” This
      standard establishes a standard definition for fair value, establishes a
      framework under generally accepted accounting principles for measuring fair
      value and expands disclosure requirements for fair value measurements. This
      standard is effective for financial statements issued for fiscal years beginning
      after November 15, 2007. Adoption
      of this statement is not expected to have any material effect on our financial
      position or results of operations .




In
      September 2006, the FASB issued Financial Accounting Standard No. 158,
“Employers’ Accounting for Defined Benefit Pension and Other Postretirement
      Plans, an amendment of FASB Statement Nos. 87, 88, 106, and 132(R *)* ,”
or
      FAS
      158. This Statement requires an employer that is a business entity and sponsors
      one or more single-employer defined benefit plans to (a) recognize the funded
      status of a benefit plan—measured as the difference between plan assets at fair
      value (with limited exceptions) and the benefit obligation—in its statement of
      financial position; (b) recognize, as a component of other comprehensive income,
      net of tax, the gains or losses and prior service costs or credits that arise
      during the period but are not recognized as components of net periodic benefit
      cost pursuant to FAS 87, *Employers’
      Accounting for Pensions* ,
      or FAS
      106, *Employers’
      Accounting for Postretirement Benefits Other Than Pensions* ;
      (c)
      measure defined benefit plan assets and obligations as of the date of the
      employer’s fiscal year-end statement of financial position (with limited
      exceptions); and (d) disclose in the notes to financial statements additional
      information about certain effects on net periodic benefit cost for the next
      fiscal year that arise from delayed recognition of the gains or losses, prior
      service costs or credits, and transition assets or obligations. An employer
      with
      publicly traded equity securities is required to initially recognize the funded
      status of a defined benefit postretirement plan and to provide the required
      disclosures as of the end of the fiscal year ending after December 15, 2006.
      This statement is not expected to have a significant effect on our financial
      statements.




In
      February 2007, the FASB issued **** Financial
      Accounting Standard No. 159 *The
      Fair Value Option for Financial Assets and Financial Liabilities—Including an
      amendment of FASB Statement No. 115* or FAS
      159. This Statement permits entities to choose to measure many financial
      instruments and certain other items at fair value. Most of the provisions of
      this Statement apply only to entities that elect the fair value option.




The
      following are eligible items for the measurement option established by this
      Statement:




1.
            Recognized
                financial assets and financial liabilities
                except:




a.
            An
                investment in a subsidiary that the entity is required to
                consolidate




b.
            An
                interest in a variable interest entity that the entity is required
                to
                consolidate




24


c.
            Employers’
                and plans’ obligations (or assets representing net overfunded positions)
                for pension benefits, other postretirement benefits (including health
                care
                and life insurance benefits), post employment benefits, employee
                stock
                option and stock purchase plans, and other forms of deferred compensation
                arrangements.




d.
            Financial
                assets and financial liabilities recognized under leases as defined
                in
                FASB Statement No. 13,*Accounting
                for Leases.*




e.
            Deposit
                liabilities, withdrawable on demand, of banks, savings and loan
                associations, credit unions, and other similar depository
                institutions




f.
            Financial
                instruments that are, in whole or in part, classified by the issuer
                as a
                component of shareholder’s equity (including “temporary equity”). An
                example is a convertible debt security with a noncontingent beneficial
                conversion feature.




2.
            Firm
                commitments that would otherwise not be recognized at inception and
                that
                involve only financial instruments




3.
            Nonfinancial
                insurance contracts and warranties that the insurer can settle by
                paying a
                third party to provide those goods or
                services




4.
            Host
                financial instruments resulting from separation of an embedded
                nonfinancial derivative instrument from a nonfinancial hybrid
                instrument.




The
      fair
      value option:




1.
            May
                be applied instrument by instrument, with a few exceptions, such
                as
                investments otherwise accounted for by the equity
                method




2.
            Is
                irrevocable (unless a new election date
                occurs)




3.
            Is
                applied only to entire instruments and not to portions of
                instruments.




The
      Statement is effective as of the beginning of an entity’s first fiscal year that
      begins after November 15, 2007. Early adoption is permitted as of the beginning
      of a fiscal year that begins on or before November 15, 2007, provided the entity
      also elects to apply the provisions of FASB Statement No. 157, *Fair
      Value Measurements* .
      We have
      not yet determined what effect, if any, adoption of this Statement will have
      on
      our financial position or results of operations .




SAB
      108 -
‘Considering the Effects of Prior Year Misstatements when Quantifying
      Misstatements in Current Year Financial Statements’




In
      September 2006, the SEC issued Staff Accounting Bulletin No. 108 (SAB 108),
      Considering the Effects of Prior Year Misstatements when Quantifying
      Misstatements in Current Year Financial Statements. SAB 108 provides guidance
      on
      the consideration of the effects of prior year unadjusted errors in quantifying
      current year misstatements for the purpose of a materiality assessment. Adoption
      of this statement is not expected to have any material effect on our financial
      position or results of operations .




FIN
      48 -
‘Accounting for Uncertainty in Income Taxes’




In
      June
      2006, the FASB issued Interpretation No. 48 (“FIN 48”), “Accounting for
      Uncertainty in Income Taxes”, an interpretation of SFAS No. 109. FIN 48
      prescribes a comprehensive model for how companies should recognize, measure,
      present and disclose uncertain tax positions taken or expected to be taken
      on a
      tax return. Under FIN 48, we shall initially recognize tax positions in the
      financial statements when it is more likely than not the position will be
      sustained upon examination by the tax authorities. We shall initially and
      subsequently measure such tax positions as the largest amount of tax benefit
      that is greater than 50% likely of being realized upon ultimate settlement
      with
      the tax authority assuming full knowledge of the position and all relevant
      facts. FIN 48 also revises disclosure requirements to include an annual tabular
      roll-forward of unrecognized tax benefits. We will adopt this interpretation
      as
      required in 2007 and will apply its provisions to all tax positions upon initial
      adoption with any cumulative effect adjustment recognized as an adjustment
      to
      retained earnings. Adoption
      of this statement is not expected to have any material effect on our financial
      position or results of operations.




25




EITF
      00-19-2, "Accounting for Registration Payment Arrangements".




In
      December 2006, the FASB issued Staff Position FSP EITF 00-19-2, "Accounting
      for
      Registration Payment Arrangements". This statement is effective for existing
      registration payment arrangements as of January 1, 2007, with earlier
      application permitted in previously-unissued financial statements. As discussed
      in Note 8 and as permitted by the FSP, we adopted the provisions of this FSP
      in
      our fourth quarter of 2006, resulting in re-classification of certain of our
      outstanding warrants from derivative instrument liabilities to
      equity.




In
      December 2007, the FASB issued SFAS No. 160 Noncontrolling Interests in
      Consolidated Financial Statements—an amendment of ARB No. 51. SFAS 160
      establishes accounting and reporting standards for the noncontrolling interest
      in a subsidiary and for the deconsolidation of a subsidiary. The guidance will
      become effective as of the beginning of the Company’s fiscal year beginning
      after December 15, 2008. The Company has not yet determined the impact, if
      any,
      of SFAS 160 on its consolidated financial statements.




**Off
      Balance Sheet Arrangements**




None ****




**DISCUSSION
      OF CRITICAL ACCOUNTING ESTIMATES**




Critical
      accounting estimates are those that management deems to be most important to
      the
      portrayal of our financial condition and results of operations, and that require
      management’s most difficult, subjective or complex judgments, due to the need to
      make estimates about the effects of matters that are inherently uncertain.
      We
      have identified six critical accounting estimates: accounts receivable
      allowances, goodwill, revenue, inventory, accounting for income taxes and
      financial instrument.




Accounts
      receivable allowances are determined using a combination of historical
      experience, current information and management judgment. Actual collections
      may
      differ from our estimates. A 10% increase in the accounts receivable allowance
      would increase bad debt expense by $40,000.




Goodwill
      represents the excess of cost over the net tangible and identifiable assets
      acquired in business combinations and are stated at cost. Goodwill and
      intangibles with indefinite lives are not amortized but tested for impairment
      no
      less frequently than annually. Impairment is measured by comparing the carrying
      value to fair value using quoted market prices, a discounted cash flow model,
      or
      a combination of both.




We
      derive
      revenues from contract revenue and services revenue, which include assistance
      in
      implementation, integration, customization, maintenance, training and
      consulting. We recognize revenue for contract and services in accordance with
      Statement of Position (SOP) 81-1, “Accounting for Certain Construction Type and
      Certain Production Type Contracts,” and SEC Staff Accounting Bulletin (SAB) 104,
“Revenue Recognition,” and EITF 00-21 Accounting for Revenue Arrangements with
      Multiple Deliverables. Contract revenue consists of fees generated from
      installation of security systems. Services revenue consists of fees generated
      by
      providing monitoring services, preventive maintenance and technical support,
      product maintenance and upgrades. Monitoring services and preventive maintenance
      and technical support are generally provided under contracts for terms varying
      from one to six years. A customer typically prepays monitoring services,
      preventive maintenance and technical support fees for an initial period. The
      related revenue is deferred and generally recognized over the term of such
      initial period. Rates for product maintenance and upgrades are generally
      provided under time and material contracts. Revenue for these services is
      recognized in the period in which the services are provided.




We
      record
      inventory at the lower of cost and net realizable value. Cost is determined
      on a
      first-in, first-out basis. We write down our inventory for obsolescence, and
      excess inventories based on assumptions about future demand and market
      conditions. The business environment in which we operate is subject to customer
      demand. If actual market conditions are less favorable than those estimated,
      additional material inventory write-down may be required. A 10% increase in
      inventory reserve would increase expenses by $0.1 million.




Income
      taxes are calculated based on the expected treatment of transactions recorded
      in
      the consolidated financial statements. In determining current and deferred
      components of income taxes, we interpret tax legislation and make assumptions
      about the timing of the reversal of deferred tax assets and liabilities. If
      our
      interpretations differ from those of tax authorities or if the timing of
      reversals is not as anticipated, the provision for income taxes could increase
      or decrease in future periods.




26




We
      review
      the terms of convertible debt and equity instruments we issue to determine
      whether there are embedded derivative instruments, including the embedded
      conversion option, that are required to be bifurcated and accounted for
      separately as a derivative financial instrument. Generally, where the ability
      to
      physical or net-share settle the conversion option is deemed to be not within
      our control, the embedded conversion option is required to be bifurcated and
      accounted for as a derivative financial instrument liability.




In
      connection with the sale of convertible debt and equity instruments, we may
      also
      issue freestanding options or warrants. Additionally, we may issue options
      or
      warrants to non-employees in connection with consulting or other services they
      provide. Although the terms of the options and warrants may not provide for
      net-cash settlement, in certain circumstances, physical or net-share settlement
      is deemed to not be within the control of the company and, accordingly, we
      are
      required to account for these freestanding options and warrants as derivative
      financial instrument liabilities, rather than as equity.




Derivative
      financial instruments are initially measured at their fair value. For derivative
      financial instruments that are accounted for as liabilities, the derivative
      instrument is initially recorded at its fair value and is then re-valued at
      each
      reporting date, with changes in the fair value reported as charges or credits
      to
      income. For option-based derivative financial instruments, we use the
      Black-Scholes option pricing model to value the derivative instruments. Any
      discount from the face value of the convertible debt instrument is amortized
      over the life of the instrument through periodic charges to income, using the
      effective interest method. The classification of derivative instruments,
      including whether such instruments should be recorded as liabilities or as
      equity, is re-assessed at the end of each reporting period. Derivative
      instrument liabilities are classified in the balance sheet as current or
      non-current based on whether or not net-cash settlement of the derivative
      instrument is expected within 12 months of the balance sheet date.




**Commitments**




We
      have
      entered into contracts for certain consulting ser v ices
      providing for monthly payments and are required to repay the principal of our
      convertible notes and promissory notes due to Laurus and other parties. In
      addition, we have also entered into an operating lease for our vehicles,
      computer and office equipment. The total minimum annual payments for the next
      five years are as follows:


**Payments
        due by** **Period**
  **Total**
              
              **2008**
              
              **2009**
              
              **2010**
              
              **2011**
              
              **2012**
              
              **Thereafter****Term
                  notes**
              
              $
              15,805,777
              
              $
              2,240,356
              
              $
              6,700,000
              
              $
              100,000
              
              $
              6,765,421
              
              $
              -
              
              $
              -**Other
                  Notes****Payable**
              
              
              303,030
              
              
              303,030
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -**Note
                  payable to****related
                  parties**
              
              
              1,500,000
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              1,500,000**Capital
                  leases***
              
              
              5,103,748
              
              
              1,564,065
              
              
              1,837,890
              
              
              1,250,708
              
              
              451,085
              
              
              -
              
              
              -**Operating****leases**
              
              
              1,065,100
              
              
              409,500
              
              
              316,600
              
              
              206,900
              
              
              89,400
              
              
              42,700
              
              
              -**Commitments****related
                  to****consulting****agreements**
              
              
              1,541,500
              
              
              737,600
              
              
              803,900
              
              
              -
              
              
              -
              
              
              -
              
              
              -$
              25,319,155
              
              $
              5,254,551
              
              $
              9,658,390
              
              $
              1,557,608
              
              $
              7,305,906
              
              $
              42,700
              
              $
              1,500,000




*
      The
      balance represents monthly principal and interest payment




Except
      for capital leases, the above figures do not include interest
      cost.




27


**Item
                  8.**
                **Financial
                    Statements**




**INDEX
      TO FINANCIAL STATEMENTS**




**Creative
      Vistas, Inc.**




**Consolidated
      Financial Statements**




**For
      the years ended December 31, 2007 and 2006**


Report
                  of Independent Registered Public Accounting Firm
              
              
              F-1Balance
                  Sheets
              
              
              F-2Statement
                  of Stockholders’ (Deficiency) and Other Comprehensive
                  (loss)
              
              
              F-3Statements
                  of Operations
              
              
              F-4Statements
                  of Cash Flows
              
              
              F-5Notes
                  to Financial Statements
              
              
              F-6









**REPORT
      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**




Stockholders
      and Board of Directors




**Creative
      Vistas, Inc** .




We
      have
      audited the accompanying consolidated balance sheets of Creative Vistas, Inc.
      as
      of December 31, 2007 and 2006, and the related consolidated statements of
      operations, and comprehensive (loss), stockholders’ (deficiency) and cash flows
      for the years ended December 31, 2006 and 2007. These financial statements
      are
      the responsibility of the Company's management. Our responsibility is to express
      an opinion on these financial statements based on our audits.




We
      conducted our audits in accordance with the standards of the Public Company
      Accounting Oversight Board (United States). Those standards require that we
      plan
      and perform the audits to obtain reasonable assurance about whether the
      financial statements are free of material misstatement. The Company is not
      required to have, nor were we engaged to perform, an audit of its internal
      control over financial reporting. Our audit included consideration of internal
      control over financial reporting as a basis for designing audit procedures
      that
      are appropriate in the circumstances, but not for the purpose of expressing
      an
      opinion on the effectiveness of the Company’s internal control over financial
      reporting. Accordingly, we express no such opinion. An audit includes examining,
      on a test basis, evidence supporting the amounts and disclosures in the
      financial statements. An audit also includes assessing the accounting principles
      used and significant estimates by management, as well as evaluating the overall
      financial statement presentation. We believe that our audits provide a
      reasonable basis for our opinion.




In
      our
      opinion, the financial statements referred to above present fairly, in all
      material respects, the financial position of Creative Vistas, Inc. as of
      December 31, 2007 and 2006, and results of its operations and its cash flows
      for
      the years ended December 31, 2007 and 2006, in conformity with accounting
      principles generally accepted in the United States of America.




The
      accompanying financial statements have been prepared assuming that the Company
      will continue as a going concern. As discussed in Note 1 to the financial
      statements, the Company has suffered recurring losses from operations and has
      working capital and stockholder deficiencies. These factors raise substantial
      doubt about the Company’s ability to continue as a going concern. Management’s
      plans in regard to this matter are also discussed in Note 1. The financial
      statements do not include any adjustments that might result from the outcome
      of
      this uncertainty.




Stark
      Winter Schenkein & Co., LLP




Denver,
      Colorado




March
      31,
      2008




F-1





**Creative
                Vistas, Inc.****Consolidated
                Balance Sheets****December
                31**




**2007**
            
            **2006****Assets****Current
                Assets**Cash
                and bank balances
            
            **$**
            **1,960,340**
            ****
            **$**
            **3,561,181**Accounts
                receivable, net of allowancefor
                doubtful accounts $405,432 (2006-$218,450)
            
            
            **6,187,551**
            
            
            **3,860,036**Income
                tax recoverable
            
            
            **448,126**
            
            
            **351,344**Inventory
            
            
            **1,043,815**
            
            
            **764,077**Prepaid
                expenses
            
            
            **270,930**
            
            
            **237,288**Due
                from related parties
            
            
            **2,581**
            
            
            **2,203****Total
                current assets**
            
            
            **9,913,343**
            
            
            **8,776,129****Property
                and equipment, net of depreciation**
            
            
            **6,352,014**
            
            
            **3,824,555****Deposits**
            
            
            **125,498**
            
            
            **156,080****Goodwill**
            
            
            **3,101,598**
            
            
            **2,893,845****Restricted
                cash**
            
            
            **53,430**
            
            
            **339,028****Deferred
                financing costs, net**
            
            
            **551,747**
            
            
            **647,542****Intangible
                assets**
            
            
            **1,717,003**
            
            
            **1,600,000****Deferred
                income taxes**
            
            
            **37,547**
            
            
            **32,746****$**
            **21,852,180**
            ****
            **$**
            **18,269,925****Liabilities
                and Stockholders’ (Deficiency)****Current
                Liabilities**Accounts
                payable
            
            **$**
            **3,328,740**
            ****
            **$**
            **2,578,985**Accrued
                salaries and benefits
            
            
            **1,555,981**
            
            
            **1,157,552**Accrued
                commodity taxes
            
            
            **191,204**
            
            
            **421,753**Accrued
                liabilities
            
            
            **998,287**
            
            
            **496,698**Current
                portion of obligation under capital leases
            
            
            **1,195,366**
            
            
            **710,375**Deferred
                income
            
            
            **91,900**
            
            
            **68,245**Deferred
                income taxes
            
            
            **25,858**
            
            
            **22,770**Current
                portion of term notes
            
            
            **2,240,356**
            
            
            **2,439,046**Current
                portion of other notes payable
            
            
            **303,030**
            
            
            **28,736**Due
                to related parties
            
            
            **8,143**
            
            
            **2,501****Total
                current liabilities**
            
            
            **9,938,865**
            
            
            **7,926,661****Term
                notes**
            
            
            **13,565,421**
            
            
            **14,430,776****Notes
                payable to related parties**
            
            
            **1,500,000**
            
            
            **1,500,000****Other
                payable**
            
            
            **303,030**
            
            
            **-****Obligation
                under capital lease**
            
            
            **3,184,103**
            
            
            **1,789,365****Due
                to related parties**
            
            
            **233,203**
            
            
            **199,025****28,724,622**
            
            
            **25,845,827****Stockholders'
                (deficiency)**Share
                capitalAuthorized50,000,000
                no par value preferred shares undesignated, none issued or outstanding100,000,000
                no par value common shares 34,494,623 and 33,253,358 shares issued
                and
                outstandingCommon
                stock
            
            
            **1,439,307**
            
            
            **517,990**Additional
                paid-in capital
            
            
            **4,958,871**
            
            
            **3,887,706**Accumulated
                (deficit)
            
            
            **(12,445,468**
            **)**
            ****
            **(11,863,862**
            **)**Accumulated
                other comprehensive losses
            
            
            **(825,152**
            **)**
            ****
            **(117,736**
            **)****(6,872,442**
            **)**
            ****
            **(7,575,902**
            **)****$**
            **21,852,180**
            
            **$**
            **18,269,925**




The
                accompanying notes are an integral part of these financial
                statements.





F-2




**Creative
      Vistas, Inc.**


**Consolidated
      Statement of Stockholders’ (Deficiency)**


**For
        the years ended December 31, 2006 and 2007**




**Shares**
            
            
            **Amount**
            
            
            **Additional
                paid-in
                capital**
            
            
            **Deferred
                Compensation**
            
            
            **Accumulated
                (deficit)**
            
            
            **Accumulated
                other comprehensive
                (losses)**
            
            
            **Total
                Stockholders’**
              **(deficiency)**Balance,
                December 31, 2005
            
            
            32,101,716
            
            $
            -
            
            $
            (297,695
            )
            $
            (164,000
            )
            $
            (2,777,802
            )
            $
            (65,015
            )
            $
            (3,304,512
            )Stock-based
                compensation
            
            
            1,151,642
            
            
            517,990
            
            
            -
            
            
            164,000
            
            
            -
            
            
            -
            
            
            681,990Cumulative
                effect as of October 1, 2006 of change in accounting principle for
                registration payment arrangements
            
            
            -
            
            
            -
            
            
            4,121,871
            
            
            -
            
            
            (3,544,168
            )
            
            -
            
            
            577,703Value
                of Stock Options issued to employees
            
            
            -
            
            
            -
            
            
            63,530
            
            
            -
            
            
            -
            
            
            -
            
            
            63,530Net
                (loss)
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (5,541,892
            )
            
            -
            
            
            (5,541,892
            )Translation
                adjustment
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (52,721
            )
            
            (52,721
            )**Balance,
                December 31, 2006**
            
            
            **33,253,358**
            
            
            **517,990**
            
            
            **3,887,706**
            
            
            -
            
            
            **(11,863,862**
            **)**
            
            **(117,736**
            **)**
            
            **(7,575,902**
            **)**Stock-based
                compensation
            
            
            550,516
            
            
            892,624
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            892,624Stock
                issued to employees and Laurus for the exercise of the options or
                warrants
            
            
            690,749
            
            
            28,693
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            28,693Value
                of Stock Options issued to employees
            
            
            -
            
            
            -
            
            
            176,123
            
            
            -
            
            
            -
            
            
            -
            
            
            176,123Warrants
                issued to Laurus
            
            
            -
            
            
            -
            
            
            895,042
            
            
            -
            
            
            -
            
            
            -
            
            
            895,042Net
                (losses)
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (581,606
            )
            
            -
            
            
            (581,606
            )Translation
                adjustment
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (707,416
            )
            
            (707,416
            )**Balance,
                December 31, 2007**
            
            
            **34,494,623**
            
            **$**
            **1,439,307**
            ****
            **$**
            **4,958,871**
            ****
            **$**
            **-**
            ****
            **$**
            **(12,445,468**
            **)**
            **$**
            **(825,152**
            **)**
            **$**
            **(6,872,442**
            **)**




The
      accompanying notes are an integral part of these financial
      statements.




F-3





**Creative
                Vistas, Inc.****Consolidated
                Statement of Operations and Comprehensive
                (Loss)**


**For
        the years ended December 31**


**2007**
            
            **2006****Contract
                and service revenue**Contract
            
            **$**
            **6,083,768**
            ****
            **$**
            **5,352,841**Service
            
            
            **33,860,869**
            
            
            **25,061,831**Others
            
            
            **46,431**
            
            
            **42,225****39,991,068**
            
            
            **30,456,897****Cost
                of sales**Contract
            
            
            **4,203,159**
            
            
            **3,055,938**Service
            
            
            **24,126,027**
            
            
            **17,455,096****28,329,186**
            
            
            **20,511,034****Gross
                margin**
            
            
            **11,661,882**
            
            
            **9,945,863****Operating
                expense**Project
            
            
            **1,311,646**
            
            
            **1,272,891**Selling
            
            
            **797,759**
            
            
            **679,620**General
                and administrative
            
            
            **8,060,428**
            
            
            **7,191,011****10,169,833**
            
            
            **9,143,522****Income
                from operations**
            
            
            **1,492,049**
            
            
            **802,341****Interest
                expenses and other expenses (income)**Net
                financing expenses
            
            
            **2,955,063**
            
            
            **4,617,825**Amortization
                of deferred charges
            
            
            **182,430**
            
            
            **782,881**Foreign
                currency translation gain
            
            
            **(1,063,838**
            **)**
            
            **-**Derivative
                instruments
            
            
            **-**
            
            
            **943,527****2,073,655**
            
            
            **6,344,233**Loss
                before income taxes
            
            
            **(581,606**
            **)**
            
            **(5,541,892**
            **)**Income
                taxes
            
            
            **-**
            
            
            **-**Net
                (loss)
            
            
            **(581,606**
            **)**
            
            **(5,541,892**
            **)**Other
                comprehensive (loss):Foreign
                currency translation adjustment
            
            
            **(707,416**
            **)**
            
            **(52,721**
            **)**Comprehensive
                (loss)
            
            **$**
            **(1,289,022**
            **)**
            **$**
            **(5,594,613**
            **)**Basic
                and diluted weighted-average shares
            
            
            **33,847,266**
            
            
            **32,394,008****Basic
                (loss) per share**
            
            **$**
            **(0.02**
            **)**
            **$**
            **(0.17**
            **)****Diluted
                (loss) per share**
            ****
            **$**
            **(0.02**
            **)**
            **$**
            **(0.17**
            **)**


The
      accompanying notes are an integral part of these financial
      statements.




F-4






**Creative
                Vistas, Inc.****Consolidated
                Statements of Cash Flows**


**For
        the years ended December 31,**


**2007**
            
            
            **2006****Operating
                activities**Net
                (loss)
            
            **$**
            **(581,606**
            **)**
            **$**
            **(5,541,892**
            **)**Adjustments
                to reconcile net (loss) to net cash provided by operating
                activitiesDepreciation
                of capital assets
            
            
            **1,783,129**
            
            
            **982,677**Amortization
                of intangible assets
            
            
            **637,539**
            
            
            **604,057**Amortization
                of deferred financing cost
            
            
            **182,428**
            
            
            **186,261**Derivative
                instruments
            
            
            **-**
            
            
            **3,020,136**Written
                off deferred charges
            
            
            **-**
            
            
            **600,481**Gain
                on disposal of capital assets
            
            
            **(51,014**
            **)**
            
            **(228,113**
            **)**Bad
                debt expenses
            
            
            **186,982**
            
            
            **14,987**Foreign
                exchange
            
            
            **(1,262,978**
            **)**
            
            **-**Stock-based
                compensation and interest expenses
            
            
            **1,632,093**
            
            
            **681,990**Amortization
                of employee stock option
            
            
            **176,123**
            
            
            **63,530**Changes
                in non-cash working capital balanceAccounts
                receivable
            
            
            **(1,668,916**
            **)**
            
            **134,618**Inventory
            
            
            **(184,155**
            **)**
            
            **36,862**Prepaid
                expenses
            
            
            **59,667**
            
            
            **(138,823**
            **)**Accounts
                payable and other accrued liabilities
            
            
            **(322,429**
            **)**
            
            **402,610**Deferred
                revenue
            
            
            **11,043**
            
            
            **53,760**Income
                taxes payable
            
            
            **(33,725**
            **)**
            
            **154,621**Net
                cash provided by operating activities
            
            
            **564,181**
            
            
            **1,027,762****Investing
                activities**Cash
                received with acquisition of Cancable
            
            
            **-**
            
            
            **1,226,756**Proceeds
                of sales of property and equipment
            
            
            **128,729**
            
            
            **456,442**Purchase
                of property and equipment
            
            
            **(847,911**
            **)**
            
            **(598,707**
            **)**Note
                receivable payment
            
            
            **-**
            
            
            **125,000**Net
                cash provided by (used in) investing activities
            
            
            **(719,182**
            **)**
            
            **1,209,491****Financing
                activities**Proceeds
                from bank indebtedness
            
            
            **-**
            
            
            **35,934**Repayment
                of notes payable
            
            
            **-**
            
            
            **(147,492**
            **)**Due
                to related parties
            
            
            **4,823**
            
            
            **1,641**Proceeds
                from term note
            
            
            **-**
            
            
            **2,120,102**Proceeds
                from the exercise of options
            
            
            **28,693**
            
            
            **-**Repayment
                of capital lease
            
            
            **(682,378**
            **)**
            
            **(975,527**
            **)**Restricted
                cash
            
            
            **318,111**
            
            
            **169,670**Repayment
                of convertible notes
            
            
            **-**
            
            
            **(316,803**
            **)**Repayment
                of term loans
            
            
            **(1,064,045**
            **)**
            
            **-**Net
                cash provided by (used in) financing activities
            
            
            **(1,394,796**
            **)**
            
            **887,525**Effect
                of foreign exchange rate changes on cash
            
            
            **(50,044**
            **)**
            
            **(97,291**
            **)**Net
                change in cash and cash equivalents
            
            
            **(1,559,841**
            **)**
            
            **3,027,487****Cash
                and cash equivalents,**beginning of year
            
            
            **3,560,181**
            
            
            **532,694****Cash
                and cash equivalents,**end of year
            
            **$**
            **1,960,340**
            
            **$**
            **3,560,181****Supplemental
                Cash Flow Information****Cash
                paid for the interest**
            
            **$**
            **2,060,020**
            
            **$**
            **2,536,082****Cash
                paid for income taxes**
            
            **$**
            **-**
            
            **$**
            **-****Loan
                interest or penalties paid with warrant**
            
            **$**
            **895,043**
            
            **$**
            **1,913,571****Repayment
                of convertible notes and revolving credit facilities through the
                proceeds
                of refinancing**
            
            **$**
            **-**
            
            **$**
            **7,099,786****Capital
                assets purchase through capital leases**
            
            **$**
            **2,225,471**
            
            **$**
            **1,617,175**




(a)  In
      January 2006, the Company entered into a series of agreements with Laurus
      whereby Cancable Inc. issued to Laurus a secured term note in the amount of
      $6,865,000. The proceeds of the term note were used to pay off certain debts
      of
      Cancable Inc. to its previous stockholders, Covington and BMO, in the amount
      of
      $6,013,500 and professional fees in the amount of $650,600. Cancable Inc. has
      received cash $201,000 from this transaction. Part of the professional fees
      in
      the amount of $455,400 were recorded as deferred financing costs.




F-5




(b)  In
      February 2006, the Company entered into a series of agreements with Laurus
      for
      the refinancing transaction whereby the Company issued Laurus a secured term
      note in the amount of $8,250,000. The proceeds of the term note were used to
      pay
      off outstanding revolving credit facilities and convertible term notes in the
      amount of $7,099,800, prepayment penalties in the amount of $539,300 and
      professional fees in the amount of $117,600. The professional fees were recorded
      as deferred charges. The Company has received cash $493,200 from this
      transaction.




(c)  During
      the refinancing transaction mentioned above, the Company also issued a secured
      term note in the amount of $2,000,000. $500,000 was restricted cash which the
      Company has used it for the repayment of principal and interest of this term
      note. After the payment of professional fees in the amount of $148,000, the
      Company has received cash $1,425,902 from this transaction. The professional
      fees were recorded as deferred charges.




The
      accompanying notes are an integral part of these financial
      statements.




F-6




**Creative
                Vistas, Inc.****Notes
                to Consolidated Financial Statements****For
                the years ended December 31, 2007 and 2006**




**1.**
            **Summary
                of Accounting Policies**




**Basis
      of presentation**




The
      accompanying financial statements as at and for the years ended December 31,
      2007 and 2006 have been prepared by management in accordance with United States
      generally accepted accounting principles (“GAAP”) applicable to the respective
      periods.




The
      consolidated balance sheets as at December 31, 2007 and statement of operations
      and cash flows for the year end December 31, 2007 include the accounts of
      Creative Vistas, Inc. (“CVAS”), Creative Vistas Acquisition Corp. (“AC
      Acquisition”), AC Technical Systems Ltd. (“AC Technical”), Cancable Holding
      Corp. (“Cancable Holding”), Cancable Inc., Cancable, Inc., Cancable XL Inc., XL
      Digital Services Inc. (“XL Digital”), 2141306 Ontario Inc., Iview Holding Corp.
      (“Iview Holding”), and Iview Digital Solutions Inc. (“Iview DSI”). The
      consolidated balance sheets as at December 31, 2006 and statement of operations
      and cash flows for the year end December 31, 2006 include the accounts of CVAS,
      AC Acquisition, AC Technical, Cancable Holding, Cancable, Inc., Iview Holding
      and Iview DSI. All material inter-company accounts, transactions and profits
      have been eliminated.




**Reclassifications**




Certain
      amounts from the December 31, 2006 financial statements have been reclassified
      to conform to the current year’s presentation.




**Liquidity
      and going concern**




Our
      consolidated condensed financial statements were prepared using accounting
      principles generally accepted in the United States of America applicable to
      a
      going concern, which contemplates the realization of assets and liquidation
      of
      liabilities in the normal course of business. We have incurred a loss of
      $581,606 for the year ended December 31, 2007 and have an accumulated deficit
      of
      $12,445,468  at
      December 31, 2007.




We
      have
      outstanding term loans aggregating $15,805,777, together with common stock
      options and warrants, held by Laurus. We do not currently have the ability
      to
      repay the notes in the event of a demand by the holder. Furthermore, we granted
      a security interest to Laurus in substantially all of our assets and,
      accordingly, in the event of any default under our agreements with Laurus,
      they
      could conceivably attempt to foreclose on our assets, which could cause us
      to
      terminate our operations. As of December 31, 2007, there were 6,570,096 shares
      of common stock issuable upon the exercise of warrants and 129,155 shares
      issuable upon the exercise of options which were issued to Laurus. Additionally,
      there were 49 shares of common stock of Cancable Holding issuable upon the
      exercise of options and 20 shares of common stock of Iview Holding issuable
      upon
      the exercise of options to Laurus.




Over
      the
      next twelve months the Company believes that its existing capital will be
      sufficient to sustain its operations. Management plans to seek additional
      capital in the future to fund operations, growth and expansion through
      additional equity, debt financing or credit facilities. The Company has had
      early stage discussions with investors about potential investment in the Company
      at a future date. No assurance can be made that such financing would be
      available, and if available it may take either the form of debt or equity.
      In
      either case, the financing could have a negative impact on our financial
      condition and our shareholders. The Company has introduced cost cutting
      initiatives within the Administration, Project and Selling departments to
      improve efficiency within the Company and also improve cash flow. The Company
      has also increased its rates for service provided by AC Technical by 20 percent
      to improve gross margins. This is in line with our competitors. The Company
      also
      expects to see the benefits of its research and development efforts within
      the
      next 12 months as it starts to introduce its own line of customized products
      to
      the industry. These products and technologies are expected to improve gross
      margins. The Company believes that it will be eligible for research and
      development tax credits at year end for its research and development efforts
      during the year and these are additional sources of cash flow for the Company.
      The Company is also negotiating longer credit terms with its suppliers from
      45
      days to 60 to 75 days. For all the reasons mentioned above, we believe that
      we
      have adequate short term borrowing capability and that we will be able to
      sustain our operations and continue as a going concern for a reasonable period
      of time although there can be no assurance of this.




F-7




The
      financial statements do not include any adjustments to reflect the possible
      future effects on the recoverability and classification of assets or the amounts
      and classification of liabilities that may result from the possible inability
      of
      the Company to continue as a going concern.




**Cash
      and Cash Equivalents**




The
      Company considers all cash and highly liquid investments purchased with an
      initial maturity of three months or less to be cash and cash
      equivalents.




The
      Company maintains its cash in bank deposit accounts that, at times, may exceed
      federally insured limits. The Company has not experienced any losses in such
      accounts and believes it is not exposed to any significant credit risks on
      cash
      and cash equivalents.




The
      Company’s cash and cash equivalents were $1,960,340 and $3,560,181 as at
      December 31, 2007 and 2006.




The
      Company has deposits at two financial institutions in the amount of $1,034,700
      amd $1,022,800 as at December 31, 2007 and 2006.




**Accounts
      Receivable**




The
      Company extends credit to its customers based upon a written credit policy.
      Accounts receivable are recorded at the invoiced amount and do not bear
      interest. The allowance for doubtful accounts is the Company’s best estimate for
      the amount of probable credit losses in the Company’s existing accounts
      receivable. The Company establishes an allowance for doubtful accounts based
      upon factors surrounding the credit risk of specific customers, historical
      trends, and other information. Receivable balances are reviewed on an aged
      basis
      and account balances are charged off against the allowance after all means
      of
      collection have been exhausted and the potential for recovery is considered
      remote.




**Investment
      Tax Credits**




Investment
      tax credits are accrued when qualifying expenditures are made and there is
      reasonable assurance that the credits will be realized. Investment tax credits
      earned with respect to current expenditures for qualified research and
      development activities are included in the statement of operations as a
      reduction of expenses. Tax credits earned with respect to capital expenditures
      are applied to reduce the cost of the related capital assets.




**Research
      and Development Expenditures**




Research
      and development costs (other than capital expenditures) are expensed as
      incurred. Expenditures are reduced by any related investment tax
      credits.




**Advertising
      cost**




Advertising
      cost are expensed as incurred. Total advertising cost was approximately $46,000
      and $42,000 for the year ended December 31, 2007 and 2006.




**Inventory**




Inventory
      consists of materials and supplies and is stated at the lower of cost and market
      value. Cost is generally determined on the first in, first out basis. The
      inventory is net of estimated obsolescence, and excess inventory based upon
      assumptions about future demand and market conditions. Inventory consists
      principally of parts, materials and supplies.




F-8




**Property
      and Equipment**




Property
      and equipment is stated at original cost. Expenditures for improvements that
      significantly add to productive capacity or extend the useful life of an asset
      are capitalized. Expenditures for maintenance and repairs are expensed when
      incurred. Depreciation per annum is computed over the estimated useful life
      as
      follows:


Industrial
                  condominium
              4%
                  declining balance basisLeasehold
                  improvements
              lesser
                  of 5 years or the term of the lease straight-line basisOffice
                  equipment
              20%
                  declining balance basis or 3 years straight-line methodOffice
                  equipment under capital leases
              3
                  years straight-line methodFurniture
                  and fixtures
              20%
                  declining balance basis or 3 years straight-line methodFurniture
                  and fixtures under capital leases
              5
                  years straight-line methodComputer
                  hardware and software
              30%
                  declining balance basis or 3 years straight-line methodComputer
                  hardware and software undercapital
                  leases
              3
                  years straight-line methodVehicles
              4
                  years straight-line basisVehicles
                  under capital leases
              4
                  years straight-line basisTools
                  and equipment
              3
                  years straight-line basis




**Customer
      Relationships and Trade Name**




Customer
      relationships and trade name represents the acquisition cost of acquired
      customer relationships and trade name of Cancable and XL Digital are recorded
      at
      cost less accumulated amortization. Amortization for customer relationships
      and
      trade name is provided on a straight-line basis over the period of expected
      benefit of 5 and 3 years. The Company reviews the revenues from the customer
      list at each balance sheet date to determine whether circumstances indicate
      that
      the carrying amount of the asset should be assessed. Management determined
      there
      was no impairment at December 31, 2006 and 2007. Amortization charged to
      operations aggregated $637,539 in 2007 and $600,000 in 2006.




**Long-Lived
      Assets**




The
      Company reviews its long-lived assets for impairment at each balance sheet
      date
      and whenever events or changes in circumstances indicate that the carrying
      amount of an asset should be assessed. To determine if an impairment exists,
      the
      Company estimates the future undiscounted cash flows expected to result from
      the
      use of the asset being reviewed for impairment. If the sum of these expected
      future cash flows is less than the carrying amount of the asset, the Company
      recognizes an impairment loss in accordance with SFAS No. 144, Accounting for
      the Impairment or Disposal of Long-Lived Assets. The amount of the impairment
      recognized is determined by estimating the fair value of the assets and
      recording a loss for the excess of the carrying value over the fair value.
      Management determined there was no impairment at December 31, 2006 and
      2007.




**Goodwill**




Goodwill
      is evaluated for potential impairment on an annual basis or whenever events
      or
      circumstances indicate that impairment may have occurred. Statement of
      Accounting Standards No. 142, “Goodwill and Other Intangible Assets”, (“SFAS No.
      142”) requires that goodwill be tested for impairment using a two-step process.
      The first step of the goodwill impairment test, used to identify potential
      impairment, compares the estimated fair value of the reporting unit containing
      goodwill with the related carrying amount. If the estimated fair value of the
      reporting unit exceeds its carrying amount, the reporting unit’s goodwill is not
      considered to be impaired and the second step of the impairment test is
      unnecessary. If the reporting unit’s carrying amount exceeds its estimated fair
      value, the second step test must be performed to measure the amount of the
      goodwill impairment loss, if any. The second step test compares the implied
      fair
      value of the reporting unit’s goodwill, determined in the same manner as the
      amount of goodwill recognized in a business combination, with the carrying
      amount of such goodwill. If the carrying amount of the reporting unit’s goodwill
      exceeds the implied fair value of the goodwill so calculated, an impairment
      loss
      is recognized in an amount equal to the excess. Management determined there
      was
      no impairment at December 31, 2006 and 2007.




**Deferred
      Financing Costs**




Deferred
      financing costs represent costs directly related to obtaining of financing.
      Deferred financing costs are amortized over the term of the related indebtedness
      using the effective interest method.




**Issuance
      of Equity Instruments for Services**




In
      December 2004, the FASB issued SFAS 123 (revised 2004) “Share-Based Payment”.
      This Statement requires that the cost resulting from all share-based
      transactions be recorded in the financial statements. The Statement establishes
      fair value as the measurement objective in accounting for share-based payment
      arrangements and requires all entities to apply a fair-value-based measurement
      in accounting for share-based payment transactions with employees. The Statement
      also establishes fair value as the measurement objective for transactions in
      which an entity acquires goods or services from non-employees in share-based
      payment transactions. The Statement replaces SFAS 123 “Accounting for
      Stock-Based Compensation” and supersedes APB Opinion No. 25 “Accounting for
      Stock Issued to Employees”. The provisions of this Statement were effective for
      the Company beginning with its fiscal year ending December 31, 2006. Stock-based
      awards to non-employees are accounted for in accordance with the provisions
      of
      the FASB issued SFAS 123 (revised 2004) “Share-Based Payment” and Emerging
      Issues Task Force (“EITF”) Issue No. 96-18, Accounting for Equity Instruments
      That Are Issued to Other Than Employees for Acquiring, or in Conjunction with
      Selling, Goods and Services.




F-9




**Revenue
      Recognition**




Contract
      Revenue




Software
      Related Services - Software related services include services to customize
      or
      enhance the software so that the software performs in accordance with specific
      customer requirements. As these services are essential to provide the required
      functionality, revenue from these arrangements is recognized in accordance
      Statement of Position (SOP) 81-1, “Accounting for Certain Construction Type and
      Certain Production Type Contracts, using either the percentage-of-completion
      method or the completed contract method. The percentage-of-completion method
      is
      used when the required services are quantifiable, based on the estimated number
      of labor hours necessary to complete the project, and under that method revenues
      are recognized using labor hours incurred as the measure of progress towards
      completion but is limited to revenue that has been earned by the attainment
      of
      any milestones included in the contract. The completed contract method is used
      when the required services are not quantifiable, and under that method revenues
      are recognized only when we have satisfied all of our product and/or service
      delivery obligations to the customer.




Security
      Systems - Security systems revenue consists of fees generated from consulting,
      audit, review, planning, engineering and design, supply of hardware systems
      installation and project management. Revenue from contracts where performance
      extends beyond one or more accounting periods is recognized in accordance with
      SOP 81-1, SEC Staff Accounting Bulletin 104, “Update of Codification of Staff
      Accounting Bulletins” and EITF 00-21, “Revenue Arrangements with Multiple
      Deliverables”. The recognition of revenue reflects the degree of completeness
      based upon project drawings, project schedules, progress of actual installation
      and are further validated by visual observations by product managers, quality
      inspectors and construction advisors, if applicable. When the current estimated
      costs to complete indicate a loss, such losses are immediately recognized for
      accounting purposes. Some projects have the equipment and installation as
      separate elements specified in the contracts. The revenue is recognized when
      each element has been satisfied in accordance with SOP81-1 and SEC Staff
      Accounting Bulletin 104, which are the delivery of the equipment and completion
      of installation process. The fair value of each element was based on the price
      charged when it is sold on a standalone basis.




For
      contracts of shorter duration, revenue is generally recognized when services
      are
      performed. Contractual terms may include the following payment arrangements:
      fixed fee, full-time equivalent, milestone, and time and material. In order
      to
      recognize revenue, the following criteria must be met:




·
            Signed
                agreement — The agreement must be signed by the
                customer.




·
            Fixed
                Fee — The signed agreement must specify the fees to be received for the
                services.




·
            Delivery
                has occurred — Delivery is substantiated by time cards and where
                applicable, supplemented by an acceptance from the customer that
                milestones as agreed in the statement have been
                met.




·
            Collectibility
                is probable — The Company conducts a credit review for significant
                transactions at the time of the engagement to determine the
                credit-worthiness of the customer. Collections are monitored over
                the term
                of each project, and if a customer becomes delinquent, the revenue
                may be
                deferred.




Service
      Revenue




Service
      revenue consists of fees generated by providing monitoring services, preventive
      maintenance and technical support, product maintenance and upgrades and regional
      broadband and cable service. Monitoring services and preventive maintenance
      and
      technical support are generally provided under contracts for terms varying
      from
      one to six years. A customer typically prepays monitoring services and
      preventive maintenance and technical support fees for an initial period, and
      the
      related revenue is deferred and generally recognized over the term of such
      initial period. Rates for product maintenance and upgrades are generally
      provided under time and material contracts. Revenue for these services is
      recognized in the period in which the services are provided




F-10




**Warranty**




The
      Company carries a reserve based upon historical warranty claims experience.
      Additionally, warranty accruals are established on the basis of anticipated
      future expenditures as specific warranty obligations are identified and they
      are
      charged against the accrual. Expenditures exceeding such accruals are expensed
      direct to cost of sales.




**Earning
      (loss) per share**




The
      Company applies SFAS No. 128, “Earnings Per Share”. Basic earning (loss) per
      share (“EPS”) is computed using the weighted average number of common shares
      outstanding during the period. Diluted EPS is computed using the weighted
      average number of common and dilutive potential common shares outstanding during
      the period. Dilutive potential common shares consist of common stock issuable
      upon exercise of stock options and warrants and conversion of debt using the
      treasury stock method. Adjustments to earnings per share calculation include
      reversing interest related to the convertible debts and changes in derivative
      instruments.




**Financial
      Instruments**




The
      carrying value of the Company’s financial instruments, including cash and cash
      equivalents, accounts receivable, accounts payable and accrued liabilities
      approximate fair value because of the short maturities of those instruments.
      Based on borrowing rates currently available to the Company for loans with
      similar terms, the carrying value of term notes convertible notes and notes
      payable are also approximate fair value except notes payable due to The Burns
      Trust and the Navaratnam Trust and related party balances for which the fair
      value is not determinable.




We
      review
      the terms of convertible debt and equity instruments we issue to determine
      whether there are embedded derivative instruments, including the embedded
      conversion option, that are required to be bifurcated and accounted for
      separately as a derivative financial instrument. Generally, where the ability
      to
      physical or net-share settle the conversion option is deemed to be not within
      the control of the company, the embedded conversion option is required to be
      bifurcated and accounted for as a derivative financial instrument
      liability.




In
      connection with the sale of convertible debt and equity instruments, we may
      also
      issue freestanding options or warrants. Additionally, we may issue options
      or
      warrants to non-employees in connection with consulting or other services they
      provide. Although the terms of the options and warrants may not provide for
      net-cash settlement, in certain circumstances, physical or net-share settlement
      is deemed to not be within the control of the company and, accordingly, we
      are
      required to account for these freestanding options and warrants as derivative
      financial instrument liabilities, rather than as equity.




Derivative
      financial instruments are initially measured at their fair value. For derivative
      financial instruments that are accounted for as liabilities, the derivative
      instrument is initially recorded at its fair value and is then re-valued at
      each
      reporting date, with changes in the fair value reported as charges or credits
      to
      income. For option-based derivative financial instruments, we use the
      Black-Scholes option pricing model to value the derivative
      instruments.




Any
      discount from the face value of the convertible debt instrument resulting from
      the allocation of part of the proceeds to embedded derivative instruments and/or
      freestanding options or warrants is amortized over the life of the instrument
      through periodic charges to income, using the effective interest method.




**Credit
      Risk**




The
      Company’s financial assets that are exposed to credit risk consist primarily of
      cash and equivalents and accounts receivable. Concentrations of credit risk
      with
      respect to accounts receivable are limited due to the generally short payment
      terms.




**Foreign
      Currency Translation**




The
      Company maintains its accounts in United States dollars and in Canadian dollars
      for Canadian-based subsidiaries. The financial statements have been translated
      into United States dollars in accordance with SFAS. No. 52, Foreign Currency
      Translation.




F-11




All
      balance sheet accounts have been translated using the exchange rates in effect
      at the balance sheet date. Statement of operations amounts has been translated
      using the average exchange rate for the year. The gains and losses resulting
      from the changes in exchange rates from year to year have been reported
      separately as a component of comprehensive income. The gain and losses resulting
      from any inter-company balances with different functional currencies would
      be
      recognized in statement of operations.




**Income
      Taxes**




The
      Company accounts for income taxes using the asset and liability approach in
      accordance with SFAS No. 109, Accounting for Income Taxes. The asset and
      liability approach requires the recognition of deferred tax liabilities and
      assets for the expected future tax consequences of temporary differences between
      the carrying amounts and the tax basis of assets and liabilities. A valuation
      allowance is provided when it is more likely than not that some portion or
      all
      of the deferred tax assets will not be realized.




The
      provision for income taxes consists of an amount for the taxes currently payable
      and a provision for the tax consequences deferred to future
      periods.




**Comprehensive
      Income**




Comprehensive
      income equals net income plus other comprehensive income. Other comprehensive
      income refers to foreign currency translation adjustments.




**Accounting
      Estimates**




The
      Company prepares its financial statements in accordance with accounting
      principles generally accepted in the United States of America, which require
      management to make estimates and assumptions that affect the reported amounts
      of
      assets, liabilities, revenues and expenses and disclosure of contingent assets
      and liabilities. The estimates and assumptions used in the accompanying
      financial statements are based upon management’s evaluation of the relevant
      facts and circumstances as of the date of the financial statements. Actual
      results may differ from the estimates and assumptions used in preparing the
      accompanying financial statements.




**Recent
      Accounting Pronouncements**





In
      September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements”. This
      standard establishes a standard definition for fair value, establishes a
      framework under generally accepted accounting principles for measuring fair
      value and expands disclosure requirements for fair value measurements. This
      standard is effective for financial statements issued for fiscal years beginning
      after November 15, 2007. Adoption
      of this statement is not expected to have any material effect on our financial
      position or results of operations .




SFAS
        158
        - ‘ Employers’
        Accounting for Defined Benefit Pension and Other Postretirement Plans, an
        amendment of FASB Statement Nos. 87, 88, 106, and 132(R) ’
 
 In
        September 2006, the FASB issued Financial Accounting Standard No. 158, *Employers’
        Accounting for Defined Benefit Pension and Other Postretirement Plans, an
        amendment of FASB Statement Nos. 87, 88, 106, and 132(R)* ,
        or FAS
        158. This Statement requires an employer that is a business entity and sponsors
        one or more single-employer defined benefit plans to (a) recognize the funded
        status of a benefit plan—measured as the difference between plan assets at fair
        value (with limited exceptions) and the benefit obligation—in its statement of
        financial position; (b) recognize, as a component of other comprehensive
        income,
        net of tax, the gains or losses and prior service costs or credits that arise
        during the period but are not recognized as components of net periodic benefit
        cost pursuant to FAS 87, *Employers’
        Accounting for Pensions* ,
        or FAS
        106, *Employers’
        Accounting for Postretirement Benefits Other Than Pensions* ;
        (c)
        measure defined benefit plan assets and obligations as of the date of the
        employer’s fiscal year-end statement of financial position (with limited
        exceptions); and (d) disclose in the notes to financial statements additional
        information about certain effects on net periodic benefit cost for the next
        fiscal year that arise from delayed recognition of the gains or losses, prior
        service costs or credits, and transition assets or obligations. An employer
        with
        publicly traded equity securities is required to initially recognize the
        funded
        status of a defined benefit postretirement plan and to provide the required
        disclosures as of the end of the fiscal year ending after December 15, 2006.
        This statement is not expected to have a significant effect on our financial
        statements.




F-12




SFAS
      159
      - ‘The Fair Value Option for Financial Assets and Financial
      Liabilities—Including an amendment of FASB Statement No. 115’





In
      February 2007, the FASB issued **** Financial
      Accounting Standard No. 159 *The
      Fair Value Option for Financial Assets and Financial Liabilities—Including an
      amendment of FASB Statement No. 115* or FAS
      159. This Statement permits entities to choose to measure many financial
      instruments and certain other items at fair value. Most of the provisions of
      this Statement apply only to entities that elect the fair value option.




The
      following are eligible items for the measurement option established by this
      Statement:




1.
      Recognized financial assets and financial liabilities except:




a.
            An
                investment in a subsidiary that the entity is required to
                consolidate




b.
            An
                interest in a variable interest entity that the entity is required
                to
                consolidate




c.
            Employers’
                and plans’ obligations (or assets representing net overfunded positions)
                for pension benefits, other postretirement benefits (including health
                care
                and life insurance benefits), post employment benefits, employee
                stock
                option and stock purchase plans, and other forms of deferred compensation
                arrangements.




d.
            Financial
                assets and financial liabilities recognized under leases as defined
                in
                FASB Statement No. 13,*Accounting
                for Leases.*




e.
            Deposit
                liabilities, withdrawable on demand, of banks, savings and loan
                associations, credit unions, and other similar depository
                institutions




f.
            Financial
                instruments that are, in whole or in part, classified by the issuer
                as a
                component of shareholder’s equity (including “temporary equity”). An
                example is a convertible debt security with a noncontingent beneficial
                conversion feature.




2.
      Firm
      commitments that would otherwise not be recognized at inception and that involve
      only financial instruments




3.
      Nonfinancial insurance contracts and warranties that the insurer can settle
      by
      paying a third party to provide those goods or services




4.
      Host
      financial instruments resulting from separation of an embedded nonfinancial
      derivative instrument from a nonfinancial hybrid instrument.




The
      fair
      value option:




1.
      May be
      applied instrument by instrument, with a few exceptions, such as investments
      otherwise accounted for by the equity method




2.
      Is
      irrevocable (unless a new election date occurs)




3.
      Is
      applied only to entire instruments and not to portions of
      instruments.




The
      Statement is effective as of the beginning of an entity’s first fiscal year that
      begins after November 15, 2007. Early adoption is permitted as of the beginning
      of a fiscal year that begins on or before November 15, 2007, provided the entity
      also elects to apply the provisions of FASB Statement No. 157, *Fair
      Value Measurements* .
      We have
      not yet determined what effect, if any, adoption of this Statement will have
      on
      our financial position or results of operations .




F-13




SAB
      108 -
‘Considering the Effects of Prior Year Misstatements when Quantifying
      Misstatements in Current Year Financial Statements’




In
      September 2006, the SEC issued Staff Accounting Bulletin No. 108 (SAB 108),
      Considering the Effects of Prior Year Misstatements when Quantifying
      Misstatements in Current Year Financial Statements. SAB 108 provides guidance
      on
      the consideration of the effects of prior year unadjusted errors in quantifying
      current year misstatements for the purpose of a materiality assessment. Adoption
      of this statement is not expected to have any material effect on our financial
      position or results of operations .




FIN
      48 -
‘Accounting for Uncertainty in Income Taxes’




In
      June
      2006, the FASB issued Interpretation No. 48 (“FIN 48”), “Accounting for
      Uncertainty in Income Taxes”, an interpretation of SFAS No. 109. FIN 48
      prescribes a comprehensive model for how companies should recognize, measure,
      present and disclose uncertain tax positions taken or expected to be taken
      on a
      tax return. Under FIN 48, we shall initially recognize tax positions in the
      financial statements when it is more likely than not the position will be
      sustained upon examination by the tax authorities. We shall initially and
      subsequently measure such tax positions as the largest amount of tax benefit
      that is greater than 50% likely of being realized upon ultimate settlement
      with
      the tax authority assuming full knowledge of the position and all relevant
      facts. FIN 48 also revises disclosure requirements to include an annual tabular
      roll-forward of unrecognized tax benefits. We will adopt this interpretation
      as
      required in 2007 and will apply its provisions to all tax positions upon initial
      adoption with any cumulative effect adjustment recognized as an adjustment
      to
      retained earnings. Adoption
      of this statement is not expected to have any material effect on our financial
      position or results of operations.




EITF
      00-19-2, "Accounting for Registration Payment Arrangements".




In
      December 2006, the FASB issued Staff Position FSP EITF 00-19-2, "Accounting
      for
      Registration Payment Arrangements". This statement is effective for existing
      registration payment arrangements as of January 1, 2007, with earlier
      application permitted in previously-unissued financial statements. As discussed
      in Note 8 and as permitted by the FSP, we adopted the provisions of this FSP
      in
      our fourth quarter of 2006, resulting in re-classification of certain of our
      outstanding warrants from derivative instrument liabilities to
      equity.




In
      December 2007, the FASB issued SFAS No. 160 Noncontrolling Interests in
      Consolidated Financial Statements—an amendment of ARB No. 51. SFAS 160
      establishes accounting and reporting standards for the noncontrolling interest
      in a subsidiary and for the deconsolidation of a subsidiary. The guidance will
      become effective as of the beginning of the Company’s fiscal year beginning
      after December 15, 2008. The Company has not yet determined the impact, if
      any,
      of SFAS 160 on its consolidated financial statements.




**2.**
            **Acquisitions**




In
      January 2006, the Company entered into an agreement, through its wholly owned
      newly formed Delaware subsidiary, Cancable Holding Corp. (“Cancable Holding”),
      to acquire all of the issued and outstanding shares of capital stock and any
      other equity interests of Cancable Inc., an Ontario corporation (“Cancable”). To
      finance the acquisition, subsidiaries of the Company entered into a loan
      agreement with Laurus Master Fund, Ltd., a Cayman Islands Company, to which
      the
      Company became a guarantor.




The
      Company, Cancable, Cancable Holding, Covington Capital Corporation (“Covington”)
      and BMO Capital Corporation (“BMO”) entered into a Stock Purchase Agreement for
      the purchase by Cancable Holding of all the issued and outstanding shares of
      capital stock and any other equity interests of Cancable.




Cancable
      and Cancable Holding entered into a series of agreements with Laurus whereby
      Cancable issued to Laurus a secured term note (the “Cancable Note”) in the
      amount of $6,865,000 and Cancable Holding issued to Laurus a related option
      to
      purchase up to 49 shares of common stock of Cancable Holding (up to 49% of
      the
      outstanding shares of Holding) at a price of $0.01 per share (the “Option”). The
      Cancable Note is secured by all of the assets of the Company and its
      subsidiaries. The principal amount of the Cancable Note bears interest at prime
      rate plus one and three quarters percent with a minimum rate of seven percent.
      Cancable and Cancable Holding have granted Laurus a right of first refusal
      with
      respect to any debt or equity financings for a period of 180 days after
      closing.




F-14




The
      Transaction described in above relating to the acquisition of Cancable was
      accounted for as a business combination in accordance with SFAS No. 141. A
      summary of the Transaction is presented below:




Fair
      value of net tangible assets acquired




Common
                stock issued
            
            $
            -Options
                to purchase common stock
            
            
            -Transaction
                costs
            
            
            260,023Equity
                purchase price
            
            
            260,023Assumed
                debt and capital lease obligations
            
            
            7,785,450Equity
                purchase price
            
            
            8,045,473Fair
                value of net tangible assetsCash
                and bank balances
            
            $
            1,226,756Accounts
                receivable
            
            
            1,420,863Inventory
                and supplies
            
            
            217,760Prepaid
                expenses
            
            
            225,485Other
                current assets
            
            
            6,766Property
                and equipment
            
            
            2,017,273Aggregate
                tangible assets
            
            
            5,114,903Accounts
                payable and accrued liabilities
            
            
            (1,962,109
            )Other
                liabilities
            
            
            (201,166
            )2,951,628Intangible
                assets
            
            
            2,200,000Goodwill
            
            $
            2,893,845




In
      October 2007, the Company entered into an agreement, through our wholly owned
      newly formed Ontario subsidiary, Cancable XL Inc. (“Cancable XL”), to acquire
      all of the issued and outstanding shares of capital stock and any other equity
      interests of XL Digital Services Inc. (“XL Digital”), an Ontario corporation. The
      total
      consideration to be paid by Cancable XL for the shares of XL Digital will be
      an
      amount equal to the earnings before interest, taxes, depreciation and
      amortization derived from the carrying on of its business by XL
      Digital for the twelve month period after the completion of the acquisition
      times 2.5. The consideration will be paid in notes, warrants to acquire stock
      of
      the Company and cash, with the total balance due on January 5, 2009. A portion
      of the purchase price will be paid in January, 2008 in the amount of $303,030
      which was classified as other note payable. The
      balance was paid subsequent to the year ended December 31,
      2007. In
      2009,
      the remaining purchasing price will be payable in cash not less than $200,000
      and/or issuance of additional penny warrants with a nominal purchase price
      to
      acquire stock in the capital of the Company..




The
      Transaction described above relating to the acquisition of XL Digital was
      accounted for as a business combination in accordance with SFAS No. 141. A
      summary of the Transaction is presented below:




Fair
      value of net tangible assets acquired




Common
                stock issued
            
            $
            -Cash
            
            
            606,060Transaction
                costs
            
            
            17,171Equity
                purchase price
            
            
            623,231Assumed
                debt and capital lease obligations
            
            
            486,041Equity
                purchase price
            
            
            1,109,272Fair
                value of net tangible assetsAccounts
                receivable
            
            $
            947,666Inventory
                and supplies
            
            
            105,089Prepaid
                expenses
            
            
            60,438Property
                and equipment
            
            
            636,855Aggregate
                tangible assets
            
            
            1,750,048Accounts
                payable and accrued liabilities
            
            
            (1,576,247
            )Other
                liabilities
            
            
            (29,858
            )143,943Intangible
                assets
            
            
            757,576Goodwill
            
            $
            $
                207,753





F-15




The
      unaudited results of operations of XL Digital have been included in the results
      of operations of the Company for the period from October 1, 2007 to December
      31,
      2007, had the acquisition of XL Digital taken place on January 1, 2007, the
      consolidated unaudited results of operations would have been as
      follows:




Revenue
            
            $
            42,457,900Net
                loss
            
            $
            (898,127
            )Net
                loss per share
            
            $
            (0.03
            )




XL
      Digital was incorporated in 2007 and no proforma information for 2006 will
      be
      provided.




**3.**
            **Prepaid
                Expenses**


The
        balance consists of the following:




**2007**
            
            **2006**Prepaid
                insurance
            
            $
            55,469
            
            $
            149,949Prepaid
                rent
            
            
            45,468
            
            
            38,160Prepaid
                leases
            
            
            21,976
            
            
            20,554Others
            
            
            148,017
            
            
            28,625$
            270,930
            
            $
            237,288




**4.**
            **Related
                Party Transactions**


Balances
        due from related parties are as follows:




**2007**
            
            
            **2006**Balance
                due from a company controlled by the president, non-interest bearing
                and
                due on demand
            
            $
            2,581
            
            $
            2,203Balances
                due to related parties are as follows:Advances
                from the Chief Executive Officer (CEO) of the Company, non-interest
                bearing with no fixed terms of repayment. The loan is subordinated
                to the
                Laurus loan
            
            $
            68,773
            
            $
            58,693Subordinated
                loan - advances from the CEO and is secured by a promissory note,
                a third
                ranking general security agreement, assignment of insurance policy,
                a
                second mortgage on the industrial condominium up to $269,955, personal
                guarantee of the president and his spouse up to $539,910 and a collateral
                second mortgage on the president's principal residence up to $77,130,
                bearing interest at 6% per annum, repayable in blended monthly payments
                of
                $10,155. The loan matured on February 14, 2005. However, the loan
                is
                subordinated to Laurus with no fixed terms of repayment and no interest
                will be charged from September 30, 2004. Total interest was
                $Nil.
            
            
            65,521
            
            
            55,919Loan
                payable to a company controlled by the president's spouse, non-interest
                bearing and due on demand
            
            
            8,143
            
            
            2,501Loan
                payable to the president of the Company, non-interest bearing with
                no
                fixed terms of repayment. The loan is subordinated to
                Laurus
            
            
            98,909
            
            
            84,413241,346
            
            
            201,526Less
                current portion
            
            
            8,143
            
            
            2,501$
            233,203
            
            $
            199,025Note
                payable to related parties are as follows:Note
                payable to the Malar Trust (the CEO is one of the beneficiaries of
                the
                trust), bearing interest at 3% per annum with no fixed terms of repayment.
                The loan is subordinated to the Laurus loan. Total interest for the
                year
                was $48,674 (2006: $48,091)
            
            $
            1,500,000
            
            $
            1,500,000





F-16




During
      the year, $166,495 (2006 - $202,500) in consulting fees were paid to Companies
      controlled by the CEO. In addition, $149,921 (2006 - $188,700) in consulting
      fees was paid to the Company controlled by the president’s spouse.




In
      September 2004, the Company issued two promissory notes with an aggregate
      principal amount of $3,300,000. On September 30, 2004, the Company repaid
      an aggregate of $1,800,000 of the principal balance. The outstanding principal
      bears interest at 3% per annum with no fixed terms of repayment and payable
      on
      demand. However, pursuant to the Laurus Financing, these notes have been
      subordinated to the Company’s obligations to Laurus. The notes each with an
      amount of $750,000 are due to The Burns Trust (the president is one of the
      beneficiaries of the trust) and the Navaratnam Trust (the CEO is one of the
      beneficiaries of the trust), respectively. During the period ended June 30,
      2006, the above two notes payable have been transferred to Malar Trust Inc.
      (the
      Company’s CEO is the shareholder of Malar Trust Inc.).




**5.**
            **Property
                and Equipment**




**2007**
            
            
            
            
            
            **2006**Cost
            
            
            AccumulatedDepreciation
            
            
            Cost
            
            
            AccumulatedDepreciationLand
            
            $
            100,258
            
            
            -
            
            $
            85,565
            
            
            -Industrial
                condominium
            
            
            864,640
            
            
            172,690
            
            
            737,926
            
            
            122,775Leasehold
                improvement
            
            
            336,896
            
            
            93,051
            
            
            98,980
            
            
            14,426Office
                equipment
            
            
            416,724
            
            
            197,445
            
            
            264,307
            
            
            88,157Office
                equipment under capital leases
            
            
            49,804
            
            
            34,586
            
            
            42,505
            
            
            15,349Furniture
                and fixtures
            
            
            277,114
            
            
            128,071
            
            
            112,057
            
            
            80,682Furniture
                and fixtures under capital leases
            
            
            22,538
            
            
            22,538
            
            
            19,235
            
            
            19,235Computer
                hardware and software
            
            
            1,040,574
            
            
            716,126
            
            
            775,332
            
            
            493,260Computer
                hardware and software under capital leases
            
            
            102,610
            
            
            102,610
            
            
            106,049
            
            
            84,242Vehicles
            
            
            667,091
            
            
            460,511
            
            
            134,554
            
            
            111,914Vehicles
                under capital leases
            
            
            5,821,390
            
            
            1,773,654
            
            
            2,643,889
            
            
            432,914Tools
                & Equipment
            
            
            1,054,817
            
            
            701,160
            
            
            711,729
            
            
            444,629$
            10,754,456
            
            
            4,402,442
            
            $
            5,732,138
            
            
            1,907,583Net
                book value
            
            
            
            
            $
            6,352,014
            
            
            
            
            $
            3,824,555




**6.**
            **Intangible
                Assets**




**2007**
            
            **2006**Cost
            
            Accumulated
                amortization
            
            Net
                book value
            
            Net
                book
              value**Customer
                relationships**
            
            $
            1,676,768
            
            $
            433,838
            
            $
            1,242,930
            
            $
            800,000**Trade
                name**
            
            $
            1,280,808
            
            $
            806,735
            
            $
            474,073
            
            $
            800,0002,957,576
            
            $
            1,240,573
            
            $
            1,717,003
            
            $
            1,600,000




For
      the
      year ended December 31, 2007, the amortization of intangible assets was $637,539
      (2006 - $600,000). The amortization for the next five years are as
      follows:




**Year**
            
            **Amount**2008
            
            $
            762,2902009
            
            
            362,3902010
            
            
            355,5562011
            
            
            135,3542012
            
            
            101,413$
            **1,717,003**




**7.**
            **Deferred
                Financing Costs, Net**




Deferred
      financing costs are associated with the Company’s term notes from Laurus Master
      Fund, Ltd., a Cayman Islands company. The balance carried forwarded from
      December 31, 2005 was written off in the amount of $600,479 as the entire
      revolving notes and convertible notes issued on September 30, 2004 were repaid.
      For the year ended December 31, 2007, the amortization of deferred financing
      cost was approximately $182,430 (2006 - $186,261).




**2007**
            
            **2006**Cost
            
            $
            953,295
            
            $
            829,944Accumulated
                amortization
            
            
            401,548
            
            
            182,402$
            551,747
            
            $
            647,542





The
        estimated amortization expense for each of the next five fiscal years and
        thereafter is as follows:




**Year**
            
            **Amount**2008
            
            $
            172,4702009
            
            
            138,7922010
            
            
            132,6392011
            
            
            107,846$
            551,747






F-17


**8.**
            **Term
                Notes**




In
      January 2006, concurrently with the closing of the acquisition of Cancable
      Inc.,
      the Company entered into a series of agreements with Laurus whereby Cancable
      issued to Laurus a secured term note (the “Cancable Note”) in the amount of
      $6,865,000 and Cancable Holding issued to Laurus a related option to purchase
      up
      to 49 shares of common stock of Cancable Holding (up to 49% of the outstanding
      shares of Cancable Holding) at a price of $0.01 per share (the “Option”). The
      loan is secured by all of the assets of the Company and its subsidiaries.




The
      Cancable Note bears interest at the prime rate plus 1.75% with a minimum rate
      of
      seven percent. Interest accrued on the term note but was not payable until
      February 1, 2006. Interest is calculated on the basis of a 360 day year. The
      minimum monthly payment on the term note is $81,726 commencing from October
      1,
      2006. The Company is not obligated, except upon an event of default, to pay
      more
      than 25% of the Principal Amount prior to December 31, 2011.




In
      February 2006, the Company and its subsidiaries, Iview Holding and Iview DSI
      entered into a series of agreements with Laurus pursuant to a refinancing
      transaction whereby the Company issued to Laurus a secured term note (the
“Company Note”) in the amount of $8,250,000, Iview DSI issued to Laurus a
      secured term note (the “Iview Note”) in the amount of $2,000,000, the Company
      issued to Laurus a related warrant to purchase up to 2,411,003 shares of common
      stock of the Company (up to 7.5% of the outstanding shares of the Company)
      at a
      price of $0.01 per share (the “Warrant”) and Iview Holding issued to Laurus a
      related option to purchase up to 20 shares of common stock of Holding (up to
      20%
      of the outstanding shares of Holding) at a price of $0.01 per share (the
“Option”). The loans are secured by all of the assets of the Company and its
      subsidiaries.




The
      Company Note bears interest at the prime rate plus 2% with a minimum rate of
      seven percent. Interest accrued on the term note but was not payable until
      April
      1, 2006. Interest is calculated on the basis of a 360 day year. The minimum
      monthly payment on the term note is $137,500 commencing March 1, 2007 to
      February 1, 2009. $4,950,000 is payable on the maturity date. The Company has
      issued warrants to purchase up to 1,080,000 shares of common stock of the
      Company at a price from $0.90 to $2.73 per share to defer the principal
      repayment from March 1, 2007 to December 1, 2007.




The
      Iview
      Note bears interest at the prime rate plus 2% with a minimum rate of seven
      percent. Interest accrued on the term note but was not payable until April
      1,
      2006. Interest is calculated on the basis of a 360 day year. The minimum monthly
      payment on the term note is $8,333 commencing March 1, 2007 to February 1,
      2011.
      $1,600,000 is payable on the maturity date. The Company is not obligated, except
      upon an event of default, to pay more than 25% of the Principal Amount prior
      to
      December 31, 2011.




Simultaneously
      with the closing of this refinancing transaction, the Company paid off the
      entire outstanding principal amount and all obligations due to Laurus under
      the
      Secured Convertible Term Note dated September 30, 2004, the Secured Convertible
      Minimum Borrowing Note dated September 30, 2004 and the Secured Revolving Note
      dated September 30, 2004 (collectively, the “2004 Notes”) and such 2004 Notes
      were subsequently cancelled.




Interest
      on the term note for the year ended December 31, 2007 was $1,645,138 (2006:
      $1,683,900).




**2007**
            
            **2006****Amount**
            
            **Amount**Cancable
                term note bears interest at prime plus 1.75% with the minimum interest
                rate 7% and due on December 31, 2010
            
            $
            5,639,110
            
            $
            6,619,822Company
                term note bears interest at prime plus 2% with the minimum interest
                rate
                7% and due on December 31, 2009
            
            
            8,250,000
            
            
            8,250,000Iview
                term note bears interest at prime plus 2% with the minimum interest
                rate
                7% and due on December 31, 2011
            
            
            1,916,667
            
            
            2,000,00015,805,777
            
            
            16,869,822Less:
                current portion
            
            
            2,240,356
            
            
            2,439,046$
            13,565,421
            
            $
            14,430,776





F-18




**The
      principal payments for the next five years are as follows:**




**Amount**2008
            
            $
            2,240,3562009
            
            
            6,700,0002010
            
            
            100,0002011
            
            
            6,765,421$
            15,805,777




**9.**
            **Net
                Financing Expenses**




**2007**
            
            **2006**Capital
                leases
            
            $
            364,408
            
            $
            254,005Interest
                of credit facility
            
            
            1,645,138
            
            
            1,683,900Interest
                on deferred principal repayment of term note
            
            
            895,043
            
            
            -Amortization
                of interest on debt instruments
            
            
            -
            
            
            168,171Interest
                and penalties on prepayment of convertible notes - cash
            
            
            -
            
            
            539,319Interest
                and penalties on prepayment of convertible notes - 2,411,003
                warrants
            
            
            -
            
            
            1,913,571Others
            
            
            50,474
            
            
            58,859$
            2,955,063
            
            $
            4,617,825




**10.**
            **Obligation
                Under Capital Leases**


**2007**
              
              **2006**Obligation
                  under capital lease - 10.9%, due January 2009,repayable
                  $451 principal and interest monthly, secured bycertain
                  office equipment
              
              **$**
              4,223
              
              $
              7,023Obligation
                  under capital lease - 8.2%, due May 2009,repayable
                  $500 principal and interest monthly, secured by11
                  vehicles
              
              
              159,862
              
              
              180,096Obligation
                  under capital lease - 8.4%, due May 2009,repayable
                  $497 principal and interest monthly, secured by10
                  vehicles
              
              
              144,531
              
              
              162,630Obligation
                  under capital lease - 8.2%, due May 2009,repayable
                  $487 principal and interest monthly, secured by14
                  vehicles
              
              
              205,584
              
              
              228,983Obligation
                  under capital lease - 8.3%, due May 2009,repayable
                  $487 principal and interest monthly, secured by22
                  vehicles
              
              
              331,543
              
              
              366,412Obligation
                  under capital lease - 8.2%, due May 2009,repayable
                  $487 principal and interest monthly, secured by5
                  vehicles
              
              
              77,295
              
              
              84,872Obligation
                  under capital lease - 14.9%, due March 2010,repayable
                  $365 principal and interest monthly, secured by25
                  vehicles
              
              
              215,771
              
              
              -
  F-19
  Obligation
                  under capital lease - 19.3%, due March 2010,repayable
                  $289 principal and interest monthly, secured by5
                  vehicles
              
              
              30,345
              
              
              -Obligation
                  under capital lease - 10.9%, due June 2010,repayable
                  $572 principal and interest monthly, secured by7
                  vehicles
              
              
              133,885
              
              
              141,903Obligation
                  under capital lease - 10.9%, due July 2010,repayable
                  $572 principal and interest monthly, secured by7
                  vehicles
              
              
              390,644
              
              
              411,549


Obligation
                  under capital lease - 12.4%, due August 2010,repayable
                  $374 principal and interest monthly, secured by5
                  vehicles
              
              
              51,217
              
              
              -Obligation
                  under capital lease - 13.4%, due August 2010,repayable
                  $374 principal and interest monthly, secured by4
                  vehicles
              
              
              40,498
              
              
              -Obligation
                  under capital lease - 13.31%, due August 2010,repayable
                  $374 principal and interest monthly, secured by6
                  vehicles
              
              
              60,818
              
              
              -Obligation
                  under capital lease - 10.9%, due August 2010,repayable
                  $572 principal and interest monthly, secured by6
                  vehicles
              
              
              119,593
              
              
              125,295Obligation
                  under capital lease - 10.9%, due September 2010,repayable
                  $578 principal and interest monthly, secured by7
                  vehicles
              
              
              143,413
              
              
              149,471Obligation
                  under capital lease - 8.9%, due November 2010,repayable
                  $564 principal and interest monthly, secured by5
                  vehicles
              
              
              107,642
              
              
              111,969Obligation
                  under capital lease - 8.9%, due December 2010,repayable
                  $576 principal and interest monthly, secured by7
                  vehicles
              
              
              156,263
              
              
              161,960Obligation
                  under capital lease - 19.3%, due February 2011,repayable
                  $586 principal and interest monthly, secured by6
                  vehicles
              
              
              141,194
              
              
              -Obligation
                  under capital lease - 10.7%, due March 2011,repayable
                  $512 principal and interest monthly, secured by20
                  vehicles
              
              
              338,726
              
              
              -Obligation
                  under capital lease - 10.9%, due March 2011,repayable
                  $486 principal and interest monthly, secured by 20
                  vehicles
              
              
              321,352
              
              
              -Obligation
                  under capital lease - 9.3%, due January 2011,repayable
                  $576 principal and interest monthly, secured by4
                  vehicles
              
              
              90,291
              
              
              92,964Obligation
                  under capital lease - 7.5%, due April 2011,repayable
                  $544 principal and interest monthly, secured by22
                  vehicles
              
              
              524,040
              
              
              -Obligation
                  under capital lease - 16.3%, due April 2011,repayable
                  $610 principal and interest monthly, secured bycertain
                  office equipment
              
              
              19,223
              
              
              19,813Obligation
                  under capital lease - 16.2%, due April 2011,repayable
                  $471 principal and interest monthly, secured bycertain
                  office equipment
              
              
              12,618
              
              
              14,136
  F-20
  Obligation
                  under capital lease - 6.5%, due April 2011,repayable
                  $551 principal and interest monthly, secured by10
                  vehicles
              
              
              232,897
              
              
              -Obligation
                  under capital lease - 8.5%, due June 2011,repayable
                  $482 principal and interest monthly, secured by1
                  vehicle
              
              
              19,979
              
              
              -Obligation
                  under capital lease - 14%, due September 2011,repayable
                  $393 principal and interest monthly, secured by22
                  vehicles
              
              
              306,022
              
              
              -Obligation
                  under capital lease - 11.7%, due May 2007,repayable
                  $581 principal and interest monthly, secured bycertain
                  computer equipments
              
              
              -
              
              
              4,419


Obligation
                  under capital lease - 10.9%, due July 2007,repayable
                  $623 principal and interest monthly, secured bycertain
                  computer equipments
              
              
              -
              
              
              5,266Obligation
                  under capital lease - 13.3%, due May 2007,repayable
                  $347 principal and interest monthly, secured bycertain
                  computer equipments
              
              
              -
              
              
              2,835Obligation
                  under capital lease - 11.0%, due June 2007,repayable
                  $863 principal and interest monthly, secured bycertain
                  computer equipments
              
              
              -
              
              
              6,628Obligation
                  under capital lease - 17.0%, due June 2007,repayable
                  $1,305 principal and interest monthly, secured bycertain
                  computer equipments
              
              
              -
              
              
              9,206Obligation
                  under capital lease - 300%, due August 2007,repayable
                  $414 principal and interest monthly, secured by82
                  vehicles
              
              
              -
              
              
              212,3104,379,469
              
              
              2,499,740Less
                  amount due within one year included in current liabilities
              
              
              1,195,366
              
              
              710,375$
              3,184,103
              
              $
              1,789,365




The
      future minimum lease payments are as follows:


2008
              
              $
              1,564,0652009
              
              
              1,837,8902010
              
              
              1,250,7082011
              
              
              451,0855,103,748Less
                  imputed interest
              
              
              724,279$
              4,379,469





Interest
      expense for the year related to capital assets was $364,408 (2006 - $254,005).




F-21




**11.**
            **Incomes
                Taxes**


The
        Company's provision for (recovery of) income taxes is comprised as
        follows:


**2007**
            
            **2006**U.S.
            
            $
            -
            
            $
            -CanadianCurrent
            
            
            -
            
            
            -Deferred
            
            
            -
            
            
            -$
            -
            
            $
            -Reconciliation
                to statutory rates is as follows:**2007**
            
            
            **2006**Income
                (loss) before income taxesIncome
                (loss) from U.S. sales
            
            $
            (3,240,620
            )
            $
            (6,266,742
            )Income
                (loss) from Canadian sales
            
            
            2,659,014
            
            
            724,850(581,606
            )
            
            (5,541,892
            )Statutory
                tax rates for U.S.
            
            
            41.00
            %
            
            41.00
            %Statutory
                tax rates for Canadian Federal
            
            
            36.12
            %
            
            36.12
            %




The
                Company has unutilized taxable losses in the United States available
                for
                carry forward to reduce income taxes of approximately $8,051,800
                otherwise
                payable in future years. In addition, the Company has unutilized
                taxable
                losses in the Canadian taxes available for carry forward to reduce
                income
                taxes of approximately $1,687,300 otherwise payable in future
                years.




**2007**
              
              **2006**Expected
                  income tax expense (recovery)
              
              $
              (469,136
              )
              
              (59.5
              )%
              $
              (2,239,995
              )
              
              (41.6
              )%Increase
                (decrease)
                in taxes resulting from:Valuation
                  allowances
              
              
              1,357,946
              
              
              172.3
              %
              
              1,719,492
              
              
              32.0
              %Permanent
                  differences
              
              
              274,089
              
              
              34.7
              %
              
              847,058
              
              
              15.7
              %Small
                  business and othertax
                  rate reductions
              
              
              (1,162,899
              )
              
              (147.5
              %)
              
              (249,775
              )
              
              (4.7
              %)Other
              
              
              -
              
              
              -
              
              
              (76,780
              )
              
              (1.4
              %)Income
                  tax expenses (recovery)
              
              $
              -
              
              
              -
              
              $
              -
              
              
              -




The
          tax
          effects of temporary differences that give rise to significant portions
          of the
          deferred tax assets and deferred tax liabilities as of December 31, 2007
          and
          2006 are presented below:




**2007**
            
            **2006****Assets**Tax
                benefits on losses carried forward under U.S. tax rate
            
            
            5,015,000
            
            
            3,660,545Tax
                benefits on losses carried forward under Canadian tax rate
            
            
            226,800
            
            
            1,600,876Accounting
                depreciation in excess of tax depreciation
            
            
            37,547
            
            
            32,746Other
            
            
            919
            
            
            7855,280,266
            
            
            5,294,952Less:
                valuation allowance
            
            
            (5,241,800
            )
            
            (5,261,421
            )38,466
            
            
            33,531Less:
                current portion
            
            
            (919
            )
            
            (785
            )$
            37,547
            
            $
            32,746**Liabilities**Income
                tax depreciation in excess of accounting depreciation
            
            $
            -
            
            $
            -Other
            
            
            26,777
            
            
            23,55526,777
            
            
            23,555Less:
                current portion
            
            
            (26,777
            )
            
            (23,555
            )$
            -
            
            $
            -





F-22




Net
                deferred income taxes**2007**
            
            **2006****Current**Assets
            
            $
            919
            
            $
            785Liabilities
            
            
            (26,777
            )
            
            (23,555
            )$
            (25,858
            )
            $
            (22,770
            )**Long-term**Assets
            
            $
            37,547
            
            $
            32,746Liabilities
            
            
            -
            
            
            -$
            37,547
            
            $
            32,746$
            11,689
            
            $
            9,976





**12.**
            **Warranty**




As
      part
      of the installation, the Company has provided its customers with warranties.
      The
      warranties generally extend ninety days labor and one year on equipment from
      the
      date of project completion.




**2007**
            
            **2006**Balance,
                beginning of year
            
            $
            34,482
            
            $
            34,482Expenses
                incurred
            
            
            (20,000
            )
            
            (10,000
            )Provision
                made
            
            
            25,922
            
            
            10,000Balance,
                end of year
            
            $
            40,404
            
            $
            34,482





**13.**
            **Shareholders’
                (Deficit)**




The
      Company has total authorized share capital of 50,000,000 preferred shares,
      no
      par value and 100,000,000 common shares, no par value.




During
      the period ended March 31, 2006, the Company entered into two consulting
      agreements by issuing 125,000 shares stock in consideration for investor
      relations services rendered with the fair value of $65,000. Total recognized
      consulting expenses relating to the above shares are $65,000. Additionally,
      the
      Company entered into another consulting agreement by issuing 75,000 shares
      in
      consideration for advisory service rendered with the fair value of $41,250.
      Total recognized advisory service expenses relating to the above shares are
      $41,250.




During
      the period ended June 30, 2006, the Company entered into three consulting
      agreements by issuing 70,880 shares stock in consideration for investor
      relations and consulting services rendered with the fair value of $52,050.
      Total
      recognized consulting expenses relating to the above shares are $52,050.




During
      the period ended September 30, 2006, the Company entered into a consulting
      agreement by issuing 41,665 shares stock in consideration for investor relations
      and consulting services rendered with the fair value of $28,749. Total
      recognized consulting expenses relating to the above shares was $28,749.
      Additionally, the Company issued 7,000 common shares to the officer of A.C.
      Technical with the fair value of $2,100. The expense was recorded under general
      and administration expenses.




During
      the period ended December 31, 2006, the Company entered into a consulting
      agreement by issuing 49,998 shares stock in consideration for investor relations
      and consulting services rendered with the fair value of $15,999. Total
      recognized consulting expenses relating to the above shares was $15,999.
      Additionally, the Company issued 243,307 common shares to the legal counsel
      with
      the fair value of $97,325. The expense was recorded under general and
      administration expenses. The Company also issued 215,517 and 323,275 shares
      to
      1608913 Ontario Inc. and Nationwide for the payment of the consulting fees
      with
      a fair value of $215,517.




F-23




During
      the period ended March 31, 2007, the Company entered into one consulting
      agreements by issuing 16,666 shares in consideration for investor relations
      services rendered with the fair value of $6,999. Additionally, the Company
      issued 258,500 shares with the fair value of $253,330 to the executive officers
      of Cancable Inc., a subsidiary of the Company. Included in the balance, $138,929
      was recorded in 2006 financial statements as General and Administrative
      expenses.




During
      the period ended June 30, 2007, the Company entered into a consulting agreement
      and issued 90,000 shares in consideration for investor relations services
      rendered with the fair value of $171,300. Additionally, the Company issued
      29,280 shares to Laurus for the exercise of the warrants issued on February
      13,
      2006 for cash aggregating $293.




During
      the period ended September 30, 2007, the Company entered into a consulting
      agreement by issuing 93,850 shares in consideration for investor relations
      and
      consulting services rendered with the fair value of $239,148. Included in the
      balance, $9,648 was recorded in 2006 General and Administrative expenses.
      Additionally, the Company issued 625,469 shares to Laurus for the exercise
      of
      the options and warrants and 4,000 shares to the employees for the exercise
      of
      the employee stock options for cash aggregating $8,240.




During
      the period ended December 31, 2007, the Company entered into a consulting
      agreement and issued 90,000 shares in consideration for investor relations
      and
      consulting services rendered with the fair value of $218,700. Additionally,
      the
      Company issued 1,500 shares to a previous employee with the fair value of $3,150
      and 32,000 shares to the employees for the exercise of the employee stock
      options for cash aggregating $20,160.




**Options**




On
      June
      30, 2006, the Company granted 2,317,000 options to purchase a maximum of
      2,317,000 shares of common stock to employees. The options allow the holders
      to
      buy the Company’s common stock at a price of $0.63 per share and expire on June
      30, 2011. During the year 2007, the Company granted 1,226,000 options to
      purchase common stock to employees. These options allow the holders to buy
      the
      Company’s common stock at a price between $0.90 to $2.59 which will be expire in
      2012 .




The
      Company’s Stock Option Plan is intended to provide incentives for key employees,
      directors, consultants and other individuals providing services to the Company
      by encouraging their ownership of the common stock of the Company and to aid
      the
      Company in retaining such key employees, directors, consultants and other
      individuals upon whose efforts the Company’s success and future growth depends
      and in attracting other such employees, directors, consultants and
      individuals.




The
      Plan
      is administered by the Board of Directors, or its Compensation Committee. Under
      the Plan, options on a total of 4,000,000 shares of common stock may be issued.
      Shares of common stock covered by options which have terminated or expired
      prior
      to exercise are available for further options under the Plan. The maximum
      aggregate number of shares of Stock that may be issued under the Plan as
“incentive stock options” is 3,500,000 shares. No options may be granted under
      the Plan after June 30, 2011; provided, however, that the Board of Directors
      may
      at any time prior to that date amends the Plan.




Options
      under the Plan may be granted to key employees of the Company, including
      officers or directors of the Company, and to consultants and other individuals
      providing services to the Company. Options may be granted to eligible
      individuals whether or not they hold or have held options previously granted
      under the Plan or otherwise granted or assumed by the Company. In selecting
      individuals for options, the Committee may take into consideration any factors
      it may deem relevant, including its estimate of the individual’s present and
      potential contributions to the success of the Company.




F-24




The
      Committee may, in its discretion, prescribe the terms and conditions of the
      options to be granted under the Plan, which terms and conditions need not be
      the
      same in each case, subject to the following:




a.   Option
      Price. The price at which each share of common stock covered by an option
      granted under the Plan may be purchased may not be less than the market value
      per share of the common stock on the date of grant of the option. The date
      of
      the grant of an option shall be the date specified by the Committee in its
      grant
      of the option, which date will normally be the date the Committee determines
      to
      make such grant.




b.   Option
      Period. The period for exercise of an option shall in no event be more than
      five
      years from the date of grant. Options may, in the discretion of the Committee,
      be made exercisable in installments during the option period.




c.   Exercise
      of Options. For the purpose of assisting an Optionee to exercise an option,
      the
      Company may make loans to the Optionee or guarantee loans made by third parties
      to the Optionee, on such terms and conditions as the Board of Directors may
      authorize. In no event shall any option be exercisable more than five years
      from
      the date of grant thereof.




d.  Lock-Up
      Period. Without the consent of the Company, an Optionee may not sell more than
      fifty percent of the shares issued under the Plan for a period of two years
      from
      the date that the Optionee exercises the option. The Committee may impose such
      other terms and conditions, not inconsistent with the terms of the Plan, on
      the
      grant or exercise of options, as it deems advisable.




The
      fair
      value of each option award is estimated on the date of grant using the
      Black-Scholes option valuation model, using the assumptions noted in the
      following table. Expected volatility is based on the historical volatility
      of
      the Company’s stock, and other factors. The Company uses historical data to
      estimate employee termination within the valuation model. Because the Company
      has not previously granted options to employees, for purposes of the valuation
      model, the Company has assumed that the life of the options will be equal to
      one-half of the combined vesting period and contractual life (i.e., that
      employees will exercise the options at the midpoint between the vesting and
      expiry date of the options). The risk-free rates used to value the options
      are
      based on the U.S. Treasury yield curve in effect at the time of
      grant.




At
      December 31, 2007 options to purchase 3,222,000 shares of common stock were
      outstanding. These options vest ratably in annual installments, over the four
      year period from the date of grant. As of December 31, 2007, there was
      $1,350,473 of total unrecognized compensation cost related to non-vested
      share-based compensation arrangements granted under the Plan. That cost is
      expected to be recognized over the four year vesting period. 473,500 options
      were vested as of December 31, 2007. The cost recognized for the year end
      December 31, 2007 was $176,123 (2006:$63,560) which was recorded as general
      and
      administration expenses.




In
      valuing the options issued, the following assumptions were used




**2007**
            
            **2006**Expected
                volatility
            
            
            45
            %
            
            45
            %Expected
                dividends
            
            
            0
            %
            
            0
            %Expected
                term (in years)
            
            
            3.0
                - 4.5
            
            
            3.0
                - 4.5Risk-free
                rate
            
            
            4.25%
                - 5.13
            %
            
            5.10%
                - 5.13
            %




A
      summary
      of option activity under the Plan during the period ended December 31, 2007
      is
      presented below:




Options
            
            Shares
            
            Weighted-Average
              Exercise
              Price
            
            Weighted-Average
              Remaining
                Contractual
              Term
            
            Intrinsic
              ValueOutstanding
                at January 1, 2006
            
            
            -
            
            
            -
            
            
            -
            
            
            -Granted
            
            
            2,317,000
            
            $
            0.63
            
            
            -Exercised
            
            
            -
            
            
            -
            
            
            -
            
            
            -Outstanding
                at December 31, 2006
            
            
            2,317,000
            
            $
            0.63
            
            
            5.0
            
            
            -Granted
            
            
            1,226,000
            
            $
            2.32Exercised
            
            
            36,000
            
            $
            0.63
            
            
            -
            
            
            -Forfeited
                or expired
            
            
            285,000
            
            $
            0.63Outstanding
                at December 31, 2007
            
            
            3,222,000
            
            $
            1.22
            
            
            4.0
            
            $
            0.67Exercisable
                at December 31, 2007
            
            
            473,500
            
            
            0.63
            
            
            -
            
            
            -





F-25




**Warrants**




We
      use
      the Black-Scholes option pricing model to value warrants issued to
      non-employees, based on the market price of our common stock at the time the
      warrants are issued. All outstanding warrants may be exercised by the holder
      at
      any time. During the year ended December 31, 2007, in connection with financing
      arrangements, the Company issued warrants to purchase 1,080,000 shares of common
      stock. The fair value of the warrants of $895,044 was measured using the
      Black-Scholes option pricing model using the following assumptions: risk free
      interest rate of 3.25% to 4.93%, expected dividend yield of 0%, volatility
      of
      45%, share price of $0.90 to $2.73 and expected life of 4 years.




As
      of
      December 31, 2007, we had the following options and warrants
      outstanding:




Issue
                Date
            
            Expiry
                Date
            
            Number
                of warrants
            
            Exercise
                Price Per share
            
            Value-issue
                date
            
            Issued
                for01-05-2004
            
            01-05-2009
            
            540,000
            
            $0.33
            
            $447,463
            
            Consulting
                and investment banking fees09-30-2004
            
            09-30-2009
            
            199,500
            
            $1.00
            
            $111,853
            
            Consulting
                and investment banking fees09-30-2004
            
            09-30-2011
            
            2,250,000
            
            $1.15
            
            $1,370,000
            
            Financing03-31-2005
            
            03-31-2012
            
            100,000
            
            $1.20
            
            $60,291
            
            Financing04-30-2005
            
            04-30-2012
            
            100,000
            
            $1.01
            
            $44,309
            
            Financing05-31-2005
            
            05-31-2012
            
            100,000
            
            $1.01
            
            $56,614
            
            Financing06-22-2005
            
            06-22-2012
            
            313,000
            
            $1.00
            
            $137,703
            
            Financing06-30-2005
            
            06-30-2012
            
            100,000
            
            $0.90
            
            $50,431
            
            Financing07-31-2005
            
            07-31-2012
            
            100,000
            
            $1.05
            
            $56,244
            
            Financing08-31-2005
            
            08-31-2012
            
            100,000
            
            $1.05
            
            $22,979
            
            Financing09-30-2005
            
            09-30-2012
            
            100,000
            
            $0.80
            
            $36,599
            
            Financing10-31-2005
            
            10-31-2012
            
            100,000
            
            $0.80
            
            $27,367
            
            Financing11-30-2005
            
            11-30-2012
            
            100,000
            
            $0.80
            
            $16,392
            
            Financing12-31-2005
            
            12-31-2012
            
            100,000
            
            $0.80
            
            $10,270
            
            Financing02-13-2006
            
            02-13-2016
            
            1,927,096
            
            $0.01
            
            $1,529,502
            
            Financing03-01-2007
            
            03-01-2011
            
            108,000
            
            $0.90
            
            $39,519
            
            Financing04-01-2007
            
            04-01-2011
            
            108,000
            
            $1.15
            
            $50,529
            
            Financing05-01-2007
            
            05-01-2011
            
            108,000
            
            $1.25
            
            $54,941
            
            Financing06-01-2007
            
            06-01-2011
            
            108,000
            
            $2.28
            
            $101,470
            
            Financing07-01-2007
            
            07-01-2011
            
            108,000
            
            $2.10
            
            $93,307
            
            Financing08-01-2007
            
            08-01-2011
            
            108,000
            
            $2.55
            
            $112,117
            
            Financing09-01-2007
            
            09-01-2011
            
            108,000
            
            $2.73
            
            $118,647
            
            Financing10-01-2007
            
            10-01-2011
            
            108,000
            
            $2.43
            
            $105,362
            
            Financing11-01-2007
            
            11-01-2011
            
            108,000
            
            $2.60
            
            $111,868
            
            Financing12-01-2007
            
            12-01-2011
            
            108,000
            
            $2.55
            
            $107,284
            
            Financing7,309,596





F-26




**14.**
            **Major
                Customers**




During
      the year ended December 31, 2007 and 2006, the Company derived 61.0% and 61.4%of
      its revenue from a single customer. The accounts receivable from this customers
      comprises
      33% (2006: 19%) of the total trade receivable balance as at December 31, 2007
      and 2006.




**15.**
            **Segment
                Information**




We
      determine and disclose our segments in accordance with SFAS No. 131 “Disclosures
      about Segments of an Enterprise and Related Information”, which uses a
“management” approach for determining segments. The management approach
      designates the internal organization that is used by management for making
      operating decisions and assessing performance as the source of the reportable
      segments. Our management reporting structure provides for the following
      segments:




Cancable




Cancable
      Inc. (“Cancable”) and its wholly owned subsidiary XL Digital Servcies, Inc. is a
      Canadian based entity in the business of providing deployment and servicing
      of
      broadband technologies in both residential and commercial markets. The Cancable
      service offering, network deployment, IT integration, and support services,
      enable the cable television and telecommunications industries to deliver a
      high
      quality broadband experience to their customers. Cancable’s clients rely on
      Cancable’s knowledge and expertise to rapidly deploy the latest technologies to
      support advanced cable services, cable broadband Internet access and DSL.
      Services provisioned include new installations, reconnections, disconnections,
      service upgrades and downgrades, inbound technical call center sales and trouble
      resolution for cable Internet subscribers, and network servicing for broadband
      video, data, and voice services for residential, business, and commercial
      marketplaces.




AC
      Technical




A.C.
      Technical Systems Ltd. (“AC Technical”), a corporation incorporated under the
      laws of the Province of Ontario, is engaged in the engineering, design,
      installation, integration and servicing of various types of security systems.




Iview
      DVSI




Iview
      Digital Solutions Inc. (“Iview DVSI”), a corporation incorporated under the laws
      of the Province of Ontario, is a newly formed subsidiary incorporated in late
      2005 to focus on providing video surveillance products and technologies to
      the
      market.




F-27




The
      following table presents financial information with respect to the segments
      that
      management uses to make decisions. We acquired Cancable as of January 1, 2006
      and its results are included from that date.




**December
                31, 2007**
            
            **December
                31, 2006****SALES:**Cancable
            
            $
            31,234,729
            
            $
            23,779,440AC
                Technical
            
            
            7,531,322
            
            
            6,492,163XL
                Digital
            
            
            1,081,705
            
            
            -Iview
            
            
            139,208
            
            
            157,594Creative
                Vistas, Inc.
            
            
            4,104
            
            
            27,700**Consolidated
                Total**
            
            $
            39,991,068
            
            $
            30,456,897**DEPRECIATION
                AND AMORTIZATION:**Cancable
            
            $
            1,697,136
            
            $
            939,054AC
                Technical
            
            
            43,472
            
            
            43,613XL
                Digital
            
            
            42,521
            
            
            -**Consolidated
                Total**
            
            $
            1,783,129
            
            $
            982,667**INTEREST
                EXPENSES:**Cancable
            
            $
            959,272
            
            
            930,872AC
                Technical
            
            
            1,800
            
            
            10,768XL
                Digital
            
            
            14,351
            
            
            -Iview
            
            
            196,298
            
            
            179,568AC
                Acquisition
            
            
            48,674
            
            
            48,091Creative
                Vistas, Inc.
            
            
            1,734,668
            
            
            3,448,526**Consolidated
                Total**
            
            $
            2,955,063
            
            
            4,617,825**NET
                INCOME (LOSS):**Cancable
            
            $
            2,841,697
            
            $
            896,633AC
                Technical
            
            
            333,607
            
            
            (150,509
            )Iview
            
            
            (117,629
            )
            
            (200,100
            )XL
                Digital
            
            
            (299,157
            )
            
            -AC
                Acquisition
            
            
            (48,674
            )
            
            (48,091
            )2141306
                Ontario Inc.
            
            
            (41,492
            )
            
            -Corporate
                (1)
            
            
            (3,249,958
            )
            
            (6,039,825
            )**Consolidated
                Total**
            
            $
            (581,606
            )
            $
            (5,541,892
            )**TOTAL
                ASSETS**Cancable
            
            $
            11,911,673
            
            $
            7,880,618AC
                Technical
            
            
            4,103,026
            
            
            3,719,040Iview
            
            
            1,404,822
            
            
            1,697,555AC
                Acquisition
            
            
            -
            
            
            -XL
                Digital
            
            
            465,335
            
            
            -2141306
                Ontario Inc.
            
            
            29,851
            
            
            -Creative
                Vistas, Inc.
            
            
            3,937,473
            
            
            4,972,712Consolidated
                Total
            
            $
            21,852,180
            
            $
            18,269,925**CAPITAL
                ASSETS**Cancable
            
            $
            4,798,916
            
            $
            3,058,227AC
                Technical
            
            
            855,214
            
            
            766,328XL
                Digital
            
            
            689,301
            
            
            -2141306
                Ontario Inc.
            
            
            8,583
            
            
            -**CONSOLIDATED
                TOTAL**
            
            $
            6,352,014
            
            $
            3,824,555**Capital
                Expenditures**Cancable
            
            $
            3,069,145
            
            $
            2,215,878AC
                Technical
            
            
            4,237
            
            
            -Iview
            
            
            -
            
            
            -AC
                Acquisition
            
            
            -
            
            
            -**Consolidated
                Total**
            
            $
            3,073,382
            
            $
            2,215,878




(1)
            Corporate
                expenses primarily include certain stock-based compensation for consulting
                and advisory services, which we do not internally allocate to our
                segments
                because they are related to our common stock and are non-cash in
                nature.




F-28




Revenues
      by geographic destination and product group were as follows:





**December
                31, 2007**
            
            **December
                31, 2006**Contract
            
            $
            6,083,768
            
            $
            5,352,841Service
            
            
            33,860,869
            
            
            25,061,831Others
            
            
            46,431
            
            
            42,225Total
                sales to external customers
            
            $
            39,991,068
            
            $
            30,456,897




All
      revenue generated by the Company was in Canada.




**16.**
            **Commitments**




The
      Company has entered into contracts for certain consulting services providing
      for
      monthly payments with the Companies controlled by the CEO and the president’s
      spouse. In addition, the Company has also entered into an operating lease for
      its premises, vehicles, computers and office equipment. The total minimum annual
      payments for the next five years are as follows:




**Total**
            
            **2008**
            
            **2009**
            
            **2010**
            
            **2011**
            
            **2012**Operating
                leases
            
            $
            1,065,100
            
            $
            409,500
            
            $
            316,600
            
            $
            206,900
            
            $
            89,400
            
            $
            42,700Commitments
                related to consulting agreements
            
            
            1,541,500
            
            
            737,600
            
            
            803,900
            
            
            -
            
            
            -
            
            
            -$
            2,606,600
            
            $
            1,147,100
            
            $
            1,120,500
            
            $
            206,900
            
            $
            89,400
            
            $
            42,700





Rental
      for 2007 and 2006 was approximately $203,000 and $252,000.




**17.**
            **Subsequent
                Events**




Subsequent
      to year end, the Company issued 324,000 warrants to Laurus to defer the monthly
      principal repayment from January to March 2008.




On
      January 22, 2008, the Company entered into a Stock Purchase Agreement (the
      “Stock Purchase Agreement”) with Erato Corporation (“Erato”) pursuant to which
      the Company purchased and acquired from Erato 2,674,407 shares of common stock,
      par value $0.0001 per share (the “Shares”), of 180 Connect Inc., a Delaware
      corporation, for an aggregate purchase price of $6,017,416 paid by the Company
      by delivery to Erato of (i) no less than 2,195,720 duly and validly issued
      shares of common stock of the Registrant and (ii) a common stock purchase
      warrant, exercisable into up to 812,988 shares of common stock of the Registrant
      at an exercise price of $0.01 per share.




On
      January 22, 2008 the Company entered into a letter agreement with Erato for
      Erato to provide up to Twelve Million Dollars ($12,000,000) in financing to
      the
      Company on such terms and conditions as the Registrant and Erato shall mutually
      agree (the “Bridge Financing”). All proceeds from the Bridge Financing may only
      be used by the Company for the purpose of financing a third party. The Company
      does not currently have an agreement to provide financing to such third party.
      Erato is currently an investor in such third party and, through its parent,
      Laurus Master Fund Ltd., a current investor in the Company. In consideration
      of
      the letter agreement, the Company issued to Erato a warrant to purchase up
      to
      1,738,365 shares of common stock of the Company at an exercise price of $0.01
      per share.




F-29


On
        January 30, 2008, the Company entered into a Warrant Purchase Agreement with
        Laurus Master Fund, Ltd., Erato Corporation, Valens U.S. Fund, LLC and Valens
        Offshore SPV I, Ltd. (collectively, the “Sellers”) pursuant to which the
        Registrant purchased and acquired from the Sellers, warrants to purchase
        450,000
        shares of common stock at an exercise price of $0.01 per share of 180 Connect
        Inc., a Delaware corporation (the “180 Connect
        Warrants”).




Also
      on
      January 30, 2008, the Company entered into a non-binding letter of intent with
      Valens U.S. Fund, LLC (the “Letter Agreement”) in which Valens U.S. Fund, LLC
      confirmed its current intention to provide up to $4,000,000 in financing to
      a
      subsidiary of the Registrant. The Letter Agreement is only an expression of
      the
      present intentions of the parties and no binding legal obligation will exist
      until the parties sign a definitive agreement.




The
      aggregate purchase price paid by the Company in exchange for the 180 Connect
      Warrants and the Letter Agreement was $1,597,500 paid by the Company by delivery
      to the Sellers of common stock purchase warrants, exercisable in the aggregate
      into up to 798,750 shares of common stock of the Registrant at an exercise
      price
      of $0.01 per share. The purchase price was allocated by the Company as follows:
      (a) $1,012,500 or $2.25 per share was paid by the Company for the 180 Connect
      Warrants by delivery to the Sellers of warrants to purchase 506,250 shares
      of
      common stock of the Company at an exercise price of $0.01 per share and (b)
      the
      Company paid to the Sellers for the Letter Agreement warrants to purchase
      292,500 shares of common stock of the Company.




F-30




**Item
          9.** **Changes
          In and Disagreements With Accountants on Accounting and Financial
          Disclosure**




Our
      prior
      auditors, BDO Dunwoody, LLP, resigned on February 28, 2006. On or about the
      same
      time, we engaged Stark Winter Schenkein & Co., LLP, as our principal
      independent accountant. The decision to change accountants was made with the
      approval of our board of directors.




During
      the most recent two fiscal years and prior to the resignation of our prior
      auditors on February 28, 2006, the Company had not consulted with Stark Winter
      Schenkein & Co., LLP on any issue including the application of accounting
      principles to a specified transaction, either completed or proposed, or the
      type
      of audit opinion that might be rendered on our financial statements, and neither
      a written report was provided to us nor oral advice was provided that was an
      important factor considered by us in reaching a decision as to our accounting,
      auditing or financial reporting issues.





No
      report
      of BDO Dunwoody, LLP on our financial statements for either of the past two
      fiscal years contained an adverse opinion, a disclaimer of opinion or a
      qualification or was modified as to uncertainty, audit, scope or accounting
      principles.




We
      believe and we have been advised by BDO Dunwoody, LLP that it concurs in such
      belief that, during our two most recent fiscal years and any subsequent interim
      period through the date of their resignation on February 28, 2006, we did not
      have any disagreement on any matter of accounting principles or practices,
      financial statement disclosure or auditing scope or procedure, which
      disagreement, if not resolved to the satisfaction of BDO Dunwoody, LLP, would
      have caused it to make reference in connection with its report on our financial
      statements to the subject matter of this disagreement.





No
      report
      of BDO Dunwoody, LLP on our financial statements for the years ended December
      31, 2004 contained an adverse opinion, a disclaimer of opinion or a
      qualification or was modified as to uncertainty, audit, scope or accounting
      principles. During the years ended December 31, 2004 and any subsequent interim
      period the former accountant’s resignation, February 28, 2006, there were no
“reportable events” within the meaning of Item 304(a)(1) of Regulation S-B
      promulgated under the Securities Act.




**Item
                  9A.**
                **Controls
                    and Procedures**




**Evaluation
      of Disclosure Controls and Procedures** We maintain disclosure controls and procedures that are designed to ensure
      that
      information required to be disclosed in our filings under the Securities
      Exchange Act of 1934, as amended, is recorded, processed, summarized and
      reported within the periods specified in the rules and forms of the SEC. This
      information is accumulated to allow timely decisions regarding required
      disclosure. As of December 31, 2007, the end of the period covered by this
      annual report on Form 10K-SB, our management, including our Chief Executive
      Officer and Chief Financial Officer, assessed the effectiveness of our
      disclosure controls and procedures, as such terms are defined under
      rules 13a-15(e) and 15d-15(e) promulgated under Securities Exchange Act of
      1934, as amended. Based on this assessment, our management concluded that our
      disclosure controls and procedures were effective as of the end period covered
      by this annual report.




**Management’s
      Annual Report on Internal Control over Financial Reporting** Our
      management is responsible for establishing and maintaining adequate internal
      control over financial reporting (as defined in Rule 13a-15(f) under the
      Securities Exchange Act of 1934, as amended). Our management assessed the
      effectiveness over internal control over financial reporting as of December
      31,
      2007. In making this assessment, our management used the criteria set forth
      by
      the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in *Internal
      Control - Integrated Framework* issued
      in
      1992, to evaluate the effectiveness of our internal control over financial
      reporting. Based upon that framework management has determined that our internal
      control over financial reporting is effective




**Changes
      in Internal Control Over Financial Reporting** There
      has not been any change in our internal control over financial reporting (as
      such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange
      Act) during our fourth fiscal quarter that has materially affected, or is
      reasonably likely to materially affect, our internal control over financial
      reporting.




28




**Item
                  9B.**
                **Other
                    Information**




None




**Item
                  10.**
                **Directors,
                    Executive Officers, Promoters and Control Persons; Compliance
                    With Section
                    16(a) of the Exchange
                    Act**




**Directors
      and Executive Officers**




**Name**
            
            **Age**
            
            **Position**Sayan
                Navaratnam
            
            33
            
            Chairman,
                Chief Executive Officer and DirectorDominic
                Burns
            
            48
            
            President
                and DirectorHeung
                Hung Lee
            
            39
            
            Chief
                Financial Officer and Secretary





Sayan
      Navaratnam-Director, Chairman and Chief Executive Officer : Mr.
      Navaratnam serves as our chairman and Chief Executive Officer. He is responsible
      for creating a platform for growth and the management of the overall vision
      and
      growth of the Company and its subsidiaries. He is also responsible for managing
      the relationship between us and our key funding partner. Mr. Navaratnam's
      mandate is to develop and enhance our portfolio of subsidiaries and
      technologies. Mr. Navaratnam graduated from University of Toronto with a Double
      Specialist degree in Economics and Political Science. He has eight years of
      experience in technology development and integration specific to the security
      industry. He also has three years of experience in telecommunications with
      Bell
      Canada. He was the CEO of Satellite Communications Inc., and its research arm
      Satellite Advanced Technologies, from 1997-2000. Mr. Navaratnam was responsible
      for coordinating and financing research and development projects and played
      a
      key role in strategic partnerships, mergers, and licensing technologies. Mr.
      Navaratnam was the Chief Operating Officer in ASPRO Technologies Ltd. from
      2000-2003. He also proposed and implemented a strategic marketing campaign
      to
      license and distribute a new line of "wavelet" products from ASPRO. Mr.
      Navaratnam joined AC Technical as Chief Executive Officer in 2003. Mr.
      Navaratnam was a member of Innovator's Alliance of Ontario, Alliance of
      Exporters and manufacturers of Ontario. Mr. Navaratnam and AC Technical were
      recognized with an award for one of the Top 100 fastest growing companies in
      Canada, from 1999 through 2003, by *Profit
      100* .





Dominic
      Burns-Director and President : Mr.
      Burns
      is our President and Director. He founded AC Technical in 1991. He completed
      his
      Electrical Apprenticeship program at one of the premier firms in Northern
      Ireland. He graduated from Belfast College of Technology with honors in City
      and
      Guilds Electrical Theory and Regulations. Mr. Burns also holds a diploma in
      radio and navigation systems. He has an extensive understanding of quality
      controls in the avionics industry and has been a pioneer in transferring some
      of
      the high standards and controls set in the avionics industry to the security
      integration market. He has been the President of AC Technical since its
      inception. He has been primarily responsible for expanding the firm's presence
      in Canada. Mr. Burns has also designed a number of internal technical and
      marketing programs to expand AC Technical's sales and technical capabilities.
      Mr. Burns has over 20 years of experience in the security integration industry.
      Mr. Burns has been a director of our company since September 30,
      2004.




Heung
      Hung Lee-Chief Financial Officer and Secretary : Ms.
      Lee
      joined AC Technical in July 2004 and she has more than 10 years experience
      in
      international public accounting primarily with large international accounting
      firms. She has advanced knowledge in financial statements disclosure and audit
      issues and has extensive international business experience in countries such
      as
      the United States, Hong Kong SAR and the Peoples' Republic of China. She was
      a
      manager at BDO Dunwoody LLP from 1999 to 2004. Ms. Lee holds a Bachelor of
      Business degree from Monash University in Australia. She is a Chartered
      Accountant in Canada and qualified CPA in Australia. Ms. Lee has been the Chief
      Financial Officer of our company since September 30, 2004. Ms. Lee is
      responsible for review of financials of subsidiaries and creating and
      implementing strong financial systems within the group of companies. Ms. Lee
      is
      also an important member in our growth strategy as she is highly involved in
      creating a platform for growth within Creative Vistas, Inc.




**Code
      of Ethics**




The
      Company has adopted a code of ethics for officers and employees, which applies
      to, among others, the Company’s principal executive officer, principal financial
      officer, and controller, and which is known as the code
      of
      ethics .
      The
      Company has also adopted certain ethical principles and policies for its
      directors, which are set forth in the code
      of
      ethics .
      The
      Company will provide copies of the code of ethics without charge upon request
      made to Creative Vistas, 2100
      Forbes Street, Unit 8-10 Whitby, Ontario, Canada L1N 9T3 or by calling (905)
      666-8676 .




29




**Item
                  11.**
                **Executive
                    Compensation**




The
      following summary compensation table set forth all compensation paid by us
      during the three years ended December 31, 2007 for services rendered in all
      capacities by the Chief Executive Officer of the Company and the only other
      executive officer who received total salary and bonus exceeding $100,000 in
      any
      of such years.




**Annual
                Compensation****Name
                and Principal**
              **Company/Subsidiary
                Position**
            
            **Year**
            
            **Salary
                ($)**
            
            **Other
                Annual Compensation ($)**
            
            **Bonus
                ($)**Sayan
                Navaratnam - Chairman and
                Chief Executive Officer
            
            
            2007
            
            
            166,495
            1
            
            -
            
            
            -2006
            
            
            202,5001
            1
            
            -
            
            
            -2005
            
            
            250,000
            1
            
            -
            
            
            -Dominic
                Burns - President
            
            
            2007
            
            
            149,921
            2
            
            -
            
            
            -2006
            
            
            188,700
            2
            
            -
            
            
            -2005
            
            
            126,000
            2
            
            -
            
            
            -





1Balance
                was payable to Nationwide Solutions Inc. for consulting
                fees.2Blance
                was payable to 1608913 Ontario Inc. for consulting
                fees.




Employment
      Agreements




On
      June
      1, 2004, AC Technical entered into a consulting agreement with 1608913 Ontario
      Inc. and Dominic Burns. Pursuant to this agreement, 1608913 Ontario is to
      provide the exclusive services of Mr. Burns to us for the following
      compensation:




·
            From
                October 1, 2004 until December 31, 2004 compensation at the rate
                of
                $210,900 (CAD$250,000);




·
            From
                January 1, 2005 until December 31, 2005 the sum of $232,000
                (CAD$275,000);




·
            From
                January 1, 2006 until December 31, 2006 the sum of $253,100
                (CAD$300,000);




·
            From
                January 1, 2007 until December 31, 2007 the sum of $274,200
                (CAD$325,000);




·
            From
                January 1, 2008 until December 31, 2008 the sum of $295,300 (CAD$350,000);
                and




·
            From
                January 1, 2009 until December 31, 2009 the sum of $316,400
                (CAD$375,000).




In
      addition, 1608913 Ontario is entitled to a bonus payable upon our attaining
      the
      annual gross revenue targets specified in the agreement for the calendar years
      2004 through 2009. The bonus is 0.5% of the annual gross revenue targets for
      2004 and 1% of the annual gross revenue target for 2005 through 2009. An
      additional bonus of 2% will be paid for each additional increment of $421,800
      (CAD$500,000) annual gross revenue beyond the revenue target in any given year.
      Mr. Burns’ spouse is the only beneficial owner of 1608913 Ontario.




On
      June
      1, 2004, AC Technical entered into a consulting agreement with Nationwide
      Solutions Inc. and Sayan Navaratnam. Pursuant to this agreement, Nationwide
      is
      to provide the exclusive services of Mr. Navaratnam to us for the following
      compensation:




·
            From
                October 1, 2004 until December 31, 2004 compensation at the rate
                of
                $253,100 (CAD$300,000) per annum;




30


·
            From
                January 1, 2005 until December 31, 2005 the sum of $278,400
                (CAD$330,000);




·
            From
                January 1, 2006 until December 31, 2006 the sum of $306,300
                (CAD$363,000);




·
            From
                January 1, 2007 until December 31, 2007 the sum of $336,900
                (CAD$399,300);




·
            From
                January 1, 2008 until December 31, 2008 the sum of $370,600 (CAD$439,230);
                and




·
            From
                January 1, 2009 until December 31, 2009 the sum of $409,300
                (CAD$485,153).




In
      addition, Nationwide is entitled to a bonus payable upon our attaining the
      annual gross revenue targets specified in the agreement for the calendar years
      2004 through 2009. The bonus is 0.5% of the annual gross revenue targets for
      2004 and 1% of the annual gross revenue target for 2005 through 2009. An
      additional bonus of 2% will be paid for each additional increment of $421,800
      (CAD$500,000) annual gross revenue beyond the revenue target in any given year.
      Mr. Navaratnam is the only beneficial owner of Nationwide.




1608913
      Ontario Inc. and Nationwide Solutions Inc. were structured for the personal
      tax
      benefit of Mr. Burns and Mr. Navaratnam, respectively. Under Canadian tax law,
      there are potential income tax benefits to Mr. Burns and Mr. Navaratnam from
      structuring their relationship to us as Consulting Agreements between us and
      each of 1608913 Ontario Inc. and Nationwide Solutions Inc. instead of them
      being
      employed directly by us. This structure does not have any effect on Creative
      Vistas.




The
      consulting services provided to us by Mr. Navaratnam and Mr. Burns related
      to
      the management of the Company including sales and marketing, project management,
      technology development, finance, operations, mergers and acquisitions,
      engineering design and other management services required by us.




We
      have a
      standard employment contract with our employee that is reviewed on an annual
      basis. Of the persons who currently are parties to this employment agreement,
      only Ms. Lee currently falls under the category of executive staff. There are
      no
      employment contracts with the CEO and the President. In each standard employment
      contract, we have included the terms of employment, remuneration, fringe
      benefits, vacation, confidentiality, non-solicitation and termination of
      employment.




We
      have a
      stock option plan which was adopted during the second quarter of
      2006.




**Item
                  12.**
                **Security
                    Ownership of Certain Beneficial Owners and Management and Related
                    Stockholder
                    Matters**




The
      following table sets forth information with respect to the beneficial ownership
      of our common stock as of December 31, 2007 of each executive officer, each
      director, and each shareholder in addition to any shareholders known to be
      the
      beneficial owner of 5% or more of our Common Stock and all officers and
      directors as a group. As of December 31, 2007, Laurus Master Fund, Ltd.
      beneficially owned 1,399,449 shares of our Common Stock. The securities
      owned by Laurus Master Fund, Ltd. contain a provision that Laurus may not,
      subject to certain exceptions, at any time beneficially own more than 4.99%
      of
      our outstanding common stock. We and Laurus have agreed that, other than on
      75
      days’ notice or upon the occurrence of an event of default, this provision may
      not be waived. Absent this limitation, Laurus would beneficially additionally
      own 6,699,251 shares of our common stock, which is comprised of 129,155 shares
      under the option and 6,570,096 shares under the warrant.




Name
                and Address of Beneficial Owner
            
            Shares
                of Common Stock Beneficially Owned
            
            Percentage
                of Common Stock Beneficially OwnedSayan
                NavaratnamToronto,
                Ontario
            
            
            21,410,986
            
            
            62.1
            %Dominic
                BurnsHampton,
                Ontario
            
            
            7,036,607
            
            
            20.4
            %Heung
                Hung LeeMarkham,
                Ontario
            
            
            50,000
            
            
            0.1
            %All
                officers and directors as a group (3 persons)
            
            
            28,497,593
            
            
            82.5
            %




31




**The
      address of the above listed persons is c/o Creative Vistas, 2100 Forbes Street,
      Unit 8-10 Whitby, Ontario, Canada L1N 9T3.**




**Securities
      Authorized For Issuance Under Equity Compensation Plans**







The
      following table sets forth certain information relating to our option plans
      as
      of December 31, 2007:





**Plan
                Category**
            
            **Nam
                of Plan**
            
            **Number
                of Common Shares to be Issued upon Exercise of Outstanding
                Options**
            
            **Weighted-Average
                Exercise Price of Oustanding Options**
            
            **Number
                of Securities Remaining Available for Future Issuance under Stock
                Option
                Plan**Option
                Plans approved by our Shareholders
            
            
            Stock
                Option Plan
            
            
            4,000,000
            
            $
            0.63
                to 2.73
            
            
            778,000Total
            
            
            
            
            
            4,000,000
            
            $
            0.63
                to 2.73
            
            
            778,000




**Share
      Option and Other Compensation Plans**







***Stock
      Option Plan***







Our
      Stock
      Option plan (“the Plan”) was adopted by our Board and approved by our
      shareholders in June 30, 2006. Our Stock option Plan provides for the grant
      of
      options to key
      employees of the Company, including officers or directors of the Company, and
      to
      consultants and other individuals providing services to the Company .




*Share
      Reserve.* A
      total of 4,000,000 shares of common
      stock, no par value, of the Company (the “Stock”) are
      authorized for issuance under the Stock Option plan as of December 31, 2007. Shares
      of
      Stock used for purposes of the Plan may be either authorized and unissued
      shares, or previously issued shares held in the treasury of the Company, or
      both. Shares of Stock covered by options which have terminated or expired prior
      to exercise shall be available for further options hereunder. The maximum
      aggregate number of shares of Stock that may be issued under the Plan under
      “incentive stock options” is 3,500,000 shares.







*Administration
      of Awards.* The
      Plan
      shall be administered by the Board of Directors, or Compensation Committee
      of
      the Board of Directors or a subcommittee of the Compensation Committee appointed
      by the Compensation Committee, or by any other committee designated by the
      Board
      of Directors to administer the Plan (the committee or subcommittee administering
      the Plan is hereinafter referred to as the “Committee”). For purposes of
      administration, the Committee, subject to the terms of the Plan, shall have
      plenary authority to establish such rules and regulations, to make such
      determinations and interpretations, and to take such other administrative
      actions as it deems necessary or advisable. All determinations and
      interpretations made by the Committee shall be final, conclusive and binding
      on
      all persons, including all Optionees, any other holders of options and their
      legal representatives and beneficiaries.




Options
      may be granted to eligible individuals whether or not they hold or have held
      options previously granted under the Plan or otherwise granted or assumed by
      the
      Company. In selecting individuals for options, the Committee may take into
      consideration any factors it may deem relevant, including its estimate of the
      individual’s present and potential contributions to the success of the Company.
      Service as an employee, director, officer or consultant of or to the Company
      shall be considered employment for purposes of the Plan (and the period of
      such
      service shall be considered the period of employment for purposes of Section
      5(d) of this Plan); provided, however, that incentive stock options may be
      granted under the Plan only to an individual who is an “employee” (as such term
      is used in Section 422 of the Code) of the Company.




*Stock
      options.* The
      Committee shall, in its discretion, prescribe the terms and conditions of the
      options to be granted hereunder, which terms and conditions need not be the
      same
      in each case, subject to the following:




*(a)Option
      Price* .
      The
      price at which each share of Stock covered by an option granted under the Plan
      may be purchased shall not be less than the Market Value (as defined in Section
      (c) hereof) per share of Stock on the date of grant of the option. The date
      of
      the grant of an option shall be the date specified by the Committee in its
      grant
      of the option.




32




*(b)Option
      Period* .
      The
      period for exercise of an option shall in no event be more than five years
      from
      the date of grant. Options may, in the discretion of the Committee, be made
      exercisable in installments during the option period. Any shares not purchased
      on any applicable installment date may be purchased thereafter at any time
      before the expiration of the option period.




*(c)Exercise
      of Options* .
      In
      order to exercise an option, the Optionee shall deliver to the Company written
      notice specifying the number of shares of Stock to be purchased, together with
      cash or a certified or bank cashier’s check payable to the order of the Company
      in the full amount of the purchase price therefore; provided that, for the
      purpose of assisting an Optionee to exercise an option, the Company may make
      loans to the Optionee or guarantee loans made by third parties to the Optionee,
      on such terms and conditions as the Board of Directors may authorize. For
      purposes of the Plan, the Market Value per share of Stock shall be the last
      sale
      price regular way on the date of reference, or, in case no sale takes place
      on
      such date, the average of the closing high bid and low asked prices regular
      way,
      in either case on the principal national securities exchange on which the Stock
      is listed or admitted to trading, or if the Stock is not listed or admitted
      to
      trading on any national securities exchange, the last sale price reported on
      the
      National Market System of the National Association of Securities Dealers
      Automated Quotation System (“NASDAQ”) on such date, or the last sale price
      reported on the NASDAQ SmallCap Market on such date, or the average of the
      closing high bid and low asked prices in the over-the-counter market on such
      date, whichever is applicable, or if there are no such prices reported on NASDAQ
      or in the over-the-counter market on such date, as furnished to the Committee
      by
      any New York Stock Exchange member selected from time to time by the Committee
      for such purpose. If there is no bid or asked price reported on any such date,
      the Market Value shall be determined by the Committee in accordance with the
      regulations promulgated under Section 2031 of the Code, or by any other
      appropriate method selected by the Committee. If the Optionee so requests,
      shares of Stock purchased upon exercise of an option may be issued in the name
      of the Optionee or another person. An Optionee shall have none of the rights
      of
      a stockholder until the shares of Stock are issued to him.




*(d)
      Effect of Termination of Employment* .
      An
      option may not be exercised after the Optionee has ceased to be in  the
      employ of the Company, except in the following circumstances:




(i)
      If
      the Optionee’s employment is terminated by action of the Company, or by reason
      of disability or retirement under any retirement plan maintained by the Company,
      the option may be exercised by the Optionee within three months after such
      termination, but only as to any shares exercisable on the date the Optionee’s
      employment so terminates;




(ii)
      In
      the event of the death of the Optionee during the three month period after
      termination of employment covered by (i) above, the person or persons to whom
      his rights are transferred by will or the laws of descent and distribution
      shall
      have a period of one year from the date of his death to exercise any options
      which were exercisable by the Optionee at the time of his death;
      and




(iii)
      In
      the event of the death of the Optionee while employed, the option shall
      thereupon become exercisable in full, and the person or persons to whom the
      Optionee’s rights are transferred by will or the laws of descent and
      distribution shall have a period of one year from the date of the Optionee’s
      death to exercise such option. In no event shall any option be exercisable
      more
      than five years from the date of grant thereof. Nothing in the Plan or in any
      option granted pursuant to the Plan (in the absence of an express provision
      to
      the contrary) shall confer on any individual any right to continue in the employ
      of the Company or continue as a consultant or interfere in any way with the
      right of the Company to terminate his employment or consulting arrangement
      at
      any time.




*(e)
      Limitation on Transferability of Options* .
      Except
      as provided in this Section (e), during the lifetime of an Optionee, options
      held by such Optionee shall be exercisable only by him and no option shall
      be
      transferable other than by will or the laws of descent and distribution. The
      Committee may, in its discretion, provide that options held by an Optionee,
      other than incentive stock options, may be transferred to or for the benefit
      of
      a member of his immediate family. For purposes hereof, the term “immediate
      family” shall mean an Optionee’s spouse and children (both natural and
      adoptive), and the direct lineal descendants of his children.




*(f)
      Adjustments for Change in Stock Subject to Plan* .
      In the
      event of a reorganization, recapitalization, stock split, stock dividend,
      combination of shares, merger, consolidation, rights offering, or any other
      change in the corporate structure or shares of the Company, the Committee shall
      make such adjustments, if any, as it deems appropriate in the number and kind
      of
      shares subject to the Plan, in the number and kind of shares covered by
      outstanding options, or in the option price per share, or both, and, in the
      case
      of a merger, consolidation or other transaction pursuant to which the Company
      is
      not the surviving corporation or pursuant to which the holders of outstanding
      Stock shall receive in exchange therefore shares of capital stock of the
      surviving corporation or another corporation, the Committee may require an
      Optionee to exchange options granted under the Plan for options issued by the
      surviving corporation or such other corporation.




33




*(g
      )Treatment of Options Upon Occurrence of Certain Events* .
      The
      Committee may, in its discretion, provide in the case of any option granted
      under the Plan that, in connection with any merger or consolidation which
      results in the holders of the outstanding voting securities of the Company
      (determined immediately prior to such merger or consolidation) owning, directly
      or indirectly, less than a majority of the outstanding voting securities of
      the
      surviving corporation (determined immediately following such merger or
      consolidation), or any sale or transfer by the Company of all or substantially
      all its assets or any tender offer or exchange offer for or the acquisition,
      directly or indirectly, by any person or group of all or a majority of the
      then
      outstanding voting securities of the Company, such option shall terminate within
      a specified number of days after notice to the Optionee thereunder, and each
      such Optionee shall receive, with respect to each share of Stock subject to
      such
      option, an amount equal to the excess, if any, of the Market Value of such
      shares immediately prior to such merger, consolidation, sale, transfer or
      exchange over the exercise price per share of such option; and that such amount
      shall be payable in cash, in one or more kinds of property (including the
      property, if any, payable in the transaction) or a combination thereof, as
      the
      Committee shall determine in its sole discretion.




*(h)
      Registration, Listing and Qualification of Shares of Stock* .
      Each
      option shall be subject to the requirement that if at any time the Board of
      Directors shall determine that the registration, listing or qualification of
      the
      shares of Stock covered thereby upon any securities exchange or under any
      federal or state law, or the consent or approval of any governmental regulatory
      body is necessary or desirable as a condition of, or in connection with, the
      granting of such option or the purchase of shares of Stock thereunder, no such
      option may be exercised unless and until such registration, listing,
      qualification, consent or approval shall have been effected or obtained free
      of
      any conditions not acceptable to the Board of Directors. The Company may require
      that any person exercising an option shall make such representations and
      agreements and furnish such information as it deems appropriate to assure
      compliance with the foregoing or any other applicable legal
      requirement.




*(i)
      Lock-Up Period* -
      Without
      the consent of the Company an Optionee may not sell more than fifty percent
      of
      the shares issued under the Plan for a period of two years from the date that
      the optionee exercises the option. The Committee may impose such other terms
      and
      conditions, not inconsistent with the terms hereof, on the grant or exercise
      of
      options, as it deems advisable.




*Additional
      Provisions Applicable to Stock Option Plan* .
      The
      Committee may, in its discretion, grant options under the Plan to eligible
      employees which constitute “incentive stock options” within the meaning of
      Section 422 of the Code; provided, however, that (a) the aggregate Market Value
      of the Stock with respect to which incentive stock options are exercisable
      for
      the first time by the Optionee during any calendar year shall not exceed the
      limitation set forth in Section 422(d) of the Code; and (b) notwithstanding
      anything to the contrary in Section 5, if the Optionee owns on the date of
      grant
      securities possessing more than 10% of the total combined voting power of all
      classes of securities of the Company or of any parent or subsidiary of the
      Company, the price per share shall not be less than 110% of the Market Value
      per
      share on the date of grant and the period of exercise shall not be longer than
      five years from the date of grant.




*Amendment
      and Termination* .
      No
      option shall be granted hereunder after June 30, 2011; provided, however, that
      the Board of Directors may at any time prior to that date terminate the Plan.
      The Board of Directors may at any time amend the Plan or any outstanding
      options. No termination or amendment of the Plan may, without the consent of
      an
      Optionee, adversely affect the rights of such Optionee under any option held
      by
      such Optionee.




**Item
                  13.**
                **Certain
                    Relationships and Related
                    Transactions**




On
      September 29, 2004, pursuant to a Stock Purchase Agreement with The Burns Trust
      (our president is one of the beneficiaries of the trust) and The Navaratnam
      Trust (our CEO is one of the beneficiaries of the trust), as sellers, A.C.
      Technical Systems Ltd. and A.C. Technical Acquisition Corp., as purchasers,
      AC
      Acquisition acquired all of the issued and outstanding shares of AC Technical
      from The Burns Trust and The Navaratnam Trust for consideration consisting
      of
      promissory notes in the aggregate amount of $3,300,000. AC Technical became
      an
      indirect subsidiary of the Company and a wholly owned direct subsidiary of
      AC
      Acquisition. $1,800,000 has been paid to The Burns Trust and The Navaratnam
      Trust through part of the funding from Laurus. As at December 31, 2004, the
      aggregate outstanding payables to The Burns Trust and the Navaratnam Trust
      were
      $1,500,000 in the form of 3% promissory notes with no fixed repayment date
      and
      these notes are payable upon demand. However, pursuant to the Laurus financing,
      these notes have been subordinated to the Company’s obligations to Laurus. The
      notes each with an amount of $750,000 are due to The Burns Trust (our president
      is one of the beneficiaries of the trust) and the Navaratnam Trust (our CEO
      is
      one of the beneficiaries of the trust), respectively. Interest expense for
      both
      of these notes payable recognized for the year was $45,000 (2004:$11,250).
      During the period ended June 30, 2006, the above two notes payable have been
      transferred to Malar Trust Inc. (the Company’s CEO is the shareholder of Malar
      Trust Inc.). See Note 4 of the Financial Statements for the year ended December
      31, 2007.




34




**Item
                  14.**
                **Principal
                    Accountant Fees and
                    Services**




The
      following table sets forth the aggregate fees for professional services rendered
      to us for the years ended December 31, 2007 and 2006 by our principal accounting
      firms, Stark Winter Schenkein & Co., LLP and BDO Dunwoody LLP:




**2007**
            
            **2006**Audit
                Fees (a)
            
            $
            120,000
            
            $
            100,000Audit
                Related Fees (b)
            
            
            -
            
            
            20,000Tax
                Fees (c)
            
            
            23,000
            
            
            5,000All
                Other Fees (d)
            
            
            -
            
            
            -Total
            
            $
            143,000
            
            $
            125,000




(a)
            *Audit
                Fees.*Fees
                for audit services billed in 2007 and 2006 consisted of the audit
                of our
                annual consolidated financial statements, reviews of our quarterly
                consolidated financial statements, statutory audits, consents and
                services
                that are normally provided in connection with statutory and regulatory
                filing or engagement. All fees were payable to Stark Winter Schenkein
                & Co., LLP for both fiscal years.




(b)
            *Audit-Related
                Fees.*Fees
                for audit-related services billed in 2006 in preparation of Form
                8-K and
                Form S-8 which were paid to Stark Winter Schenkein & Co., LLP $5,000
                and BDO Dunwoody, LLP was approximately $15,000. There are no other
                material audit-related fees in
                2007.




(c)
            *Tax
                Fees.*Fees
                for tax services billed in 2007 and 2006 consisting of assistance
                with our
                federal, state, local and foreign jurisdiction income tax returns.
                We have
                additionally sought consultation and advice related to various taxes
                compliance planning projects. Approximately $23,000 in tax fees were
                payable to MDS LLP**.**The
                tax fees for 2006 was payable to Paul Chan &
                Associate.




(d)
            *All
                Other Fees.*No
                material other fees were billed in 2006 and
                2005.




We
      do not
      have an audit committee; however, our board of directors is required to provide
      advance approval of any non-audit services, other than those of a de minimus
      nature, to be performed by our auditors, provided that such services are not
      otherwise prohibited by law. We do not have a formal pre-approval
      policy.


All
          the
          fees for 2007 and 2006 were pre-approved by the board of directors prior
          to the
          auditors’ engagement for these services.





**Item
                  15.**
                **Exhibits**




3.1*
            Articles
                of Incorporation, as amended to date, incorporated by reference to
                the
                Registrant’sForm
                8-K/A filedFebruary
                2, 2005




35




3.2*
            By-laws
                of the Registrant incorporated by reference to the Registrant’s Form 10-SB
                filed May 10, 20004.1*
            Securities
                Purchase Agreement, dated February 13, 2006, by and among Laurus
                Master
                Fund, Ltd., Creative Vistas, Inc., Iview Holding Corp. and Iview
                Digital
                Video Solutions Inc. incorporated by reference to the Registrant’s Form
                8-K filed February 17, 2006.4.2*
            Secured
                Term Note, dated February 13, 2006, issued by Creative Vistas, Inc.
                to
                Laurus Master Fund, Ltd. incorporated by reference to the Registrant’s
                Form 8-K filed February 17, 2006.4.3*
            Secured
                Term Note, dated February 13, 2006, issued by Iview Digital Video
                Solutions Inc. to Laurus Master Fund, Ltd. incorporated by reference
                to
                the Registrant’s Form 8-K filed February 17, 2006.4.4*
            Option,
                dated February 13, 2006, issued by Iview Holding Corp. to Laurus
                Master
                Fund, Ltd. incorporated by reference to the Registrant’s Form 8-K filed
                February 17, 2006.4.5*
            Warrant,
                dated February 13, 2006, issued by Creative Vistas, Inc. to Laurus
                Master
                Fund, Ltd. incorporated by reference to the Registrant’s Form 8-K filed
                February 17, 2006.4.6*
            Amended
                and Restated Guaranty, dated February 13, 2006 by and among Creative
                Vistas, Inc., Cancable Inc., Cancable Holding Corp., Cancable, Inc.,
                A.C.
                Technical Systems Ltd., Creative Vistas Acquisition Corp., Iview
                Holding
                Corp. and Iview Digital Video Solutions Inc. incorporated by reference
                to
                the Registrant’s Form 8-K filed February 17, 2006.4.7*
            Amended
                and Restated Guaranty, dated February 13, 2006 between Brent W. Swanick
                and Laurus Master Fund, Ltd. incorporated by reference to the Registrant’s
                Form 8-K filed February 17, 2006.4.8*
            Side
                Agreement, dated February 13, 2006 between Iview Digital Video Solutions,
                Inc., Iview Holding Corp., Creative Vistas Acquisition Corp. and
                Laurus
                Master Fund, Ltd incorporated by reference to the Registrant’s Form 8-K
                filed February 17, 2006.4.9*
            Joinder
                and Confirmation of Security Agreement, dated February 13, 2006 among
                Iview Holding Corp., Cancable Inc., Cancable Holding Corp., Cancable,
                Inc., A.C. Technical Systems Ltd., Creative Vistas Acquisition Corp.,
                Iview Digital Video Solutions Inc., and Creative Vistas, Inc. delivered
                to
                Laurus Master Fund, Ltd. incorporated by reference to the Registrant’s
                Form 8-K filed February 17, 2006.4.10*
            First
                Amendment to Securities Purchase Agreement, dated February 13, 2006,
                by
                and among Cancable Inc., Cancable Holding Corp.****and
                Laurus Master Fund, Ltd. for the purpose of amending the terms of
                that
                certain Securities Purchase Agreement by and among Cancable Inc.,
                Cancable
                Holding Corp. and Laurus, dated as of December 31, 2005 incorporated
                by
                reference to the Registrant’s Form 8-K filed February 17,
                2006.4.11*
            Registration
                Rights Agreement, dated as of February 13, 2006, by and between Creative
                Vistas, Inc. and Laurus Master Fund, Ltd. incorporated by reference
                to the
                Registrant’s Form 8-K filed February 17, 2006.10.1*
            Stock
                Option Plan, incorporated by reference to the Registrant’s Form S-8 filed
                October 6 200610.2*
            Rogers
                Cable Commmunications Inc. and Canacble Inc. for the provision of
                installation activities and service activities.10.3*
            Common Stock Purchase Warrant,
              dated January 22, 2008, issued by Creative Vistas, Inc. to Erato
              Corporation for the Right to Purchase 812,988 Shares of Common Stock
              of
              Creative Vistas, Inc. incorporated by reference to the Registrant’s Form
              8-K filed February 28, 2008.10.4*
            Stock
                Purchase Agreement, dated January 22, 2008, between Creative Vistas,
                Inc.
                and Erato Corporation. incorporated by reference to the Registrant’s Form
                8-K filed February 28, 2008.10.5*
            Common
                Stock Purchase Warrant, dated January 22, 2008, issued by Creative
                Vistas,
                Inc. to Erato Corporation for the Right to Purchase 1,738,365 Shares
                of
                Common Stock of Creative Vistas, Inc. incorporated by reference to
                the
                Registrant’s Form 8-K filed February 28, 2008.10.6+
            Letter
                Agreement dated January 22. 2008 between Creative Vistas, Inc. and
                Erato
                Corporation.10.7*
            Warrant
                Purchase Agreement, dated January 30, 2008 between Creative Vistas,
                Inc.,
                Laurus Master Fund, Ltd., Erato Corporation, Valens U.S. Fund, LLC
                and
                Valens Offshore SPV I, Ltd. incorporated by reference to the Schedule
                13 D
                filed by the Registrant with respect to 180 Connect Inc. dated February
                1,
                2008.10.8*
            Amended
                and Restated Common Stock Purchase Warrant dated July 2, 2007 issued
                to
                Laurus Master Fund, Ltd. by 180 Connect Inc. incorporated by reference
                to
                the Schedule 13 D filed by the Registrant with respect to 180 Connect
                Inc.
                dated February 1, 2008.




36


10.9*
            Common
                Stock Purchase Warrant, dated January 30, 2008, issued by Creative
                Vistas,
                Inc. to Erato Corporation for the Right to Purchase 2,350 Shares
                of Common
                Stock of Creative Vistas, Inc. incorporated by reference to the Schedule
                13 D filed by the Registrant with respect to 180 Connect Inc. dated
                February 1, 2008.10.10*
            Common
                Stock Purchase Warrant, dated January 30, 2008, issued by Creative
                Vistas,
                Inc. to Valens U.S. SPV I, LLC for the Right to Purchase 214,033
                Shares of
                Common Stock of Creative Vistas, Inc. incorporated by reference to
                the
                Schedule 13 D filed by the Registrant with respect to 180 Connect
                Inc.
                dated February 1, 2008.10.11*
            Common
                Stock Purchase Warrant, dated January 30, 2008, issued by Creative
                Vistas,
                Inc. to Valens Offshore SPV I, Ltd. for the Right to Purchase 582,367
                Shares of Common Stock of Creative Vistas, Inc. incorporated by reference
                to the Schedule 13 D filed by the Registrant with respect to 180
                Connect
                Inc. dated February 1, 2008.10.12+
            Non-binding
                Letter of Intent between Creative Vistas, Inc. and Valens U.S. Fund,
                LLC21.1+
            List
                of all subsidiaries31.1+
            Certification
                of Principal Executive Officer Pursuant to Section 302 of the
                Sarbanes-Oxley Act of 200231.2+
            Certification
                of Principal Financial Officer Pursuant to Section 302 of the
                Sarbanes-Oxley Act of 200232.1+
            Chief
                Executive Officer certification pursuant to 18 U.S.C. Section 1350,
                as
                adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
                200232.2+
            Chief
                Financial Officer certification pursuant to 18 U.S.C. Section 1350,
                as
                adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
                2002





*
      Previously filed and incorporated by reference




+
      Filed
      herewith




37


**SIGNATURES**




In
      accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused
      this report to be signed on its behalf by the undersigned, thereunto duly
      authorized.




**CREATIVE
                VISTAS, INC.**By:
            /s/ Sayan
              NavaratnamSayan
              NavaratnamChief
                Executive Officer




38